Last week, NAFA members received an update on the NAIC’s approval of significant revisions to its Suitability in Annuity Transactions Model Regulation. This is the culmination of a process that started in February 2017. Throughout this process, NAFA’s mandate was to make sure its membership was represented in a manner such that any changes to the current regulatory regime supported independent distribution and allowed members to grow their businesses, while ensuring that the insurance needs and financial objectives of consumers were effectively addressed. With the guidance and leadership of the Board of Directors, NAFA worked diligently to make its voice heard; the regulation’s final outcome reflects NAFA membership’s interests and concerns.
Today, NAFA is sharing a section-by-section analysis, comparing the revised NAIC 2020 Suitability in Annuity Transactions Model Regulation (#275), adopted on February 13, 2020, to the current regulation, which was last amended in 2010. To use this document, note that:
- The left-hand column of the document denotes the 10 sections of the model regulation, along with the (unchanged) title, and the three new appendices.
- The actual language of the model regulation is in the middle column – the amended, new language is in red; language deleted from the current rule is in
black strikethrough, and the unchanged language is in black font.
- The third, right-hand column summarizes and describes the changes.
NAFA will continue to provide guidance and information on how these amended standards will affect the various parties to an annuity transaction and will assist members in developing best practices under the new regulation.