Last week, we reported on regulators' efforts to change how Equity Indexed Annuities can be sold. Up 'til now, they were considered "fixed" products, meaning that any appropriately licensed life insurance agent could sell them. There was much concern, however, that these products were closer to "variable" ones (i.e. market-based returns) and should require special licensing and training to be sold.
There was much discussion of this in our comments section, for which we are very grateful.
In the end, the regulators won out:
"During an open meeting on Dec 17th the Securities and Exchange Commission adopted Rule 151A, which calls for the SEC to take over regulation of index annuities. This was opposed at the local, state and federal government levels as well as by many industry organizations including the NAIC, ACLI, NAIFA & NAFA."
[ed: this from an email I received this morning; no link as yet]
Of course, it will take some time for all the final pieces to come together, so folks who don't have their Series 6 may continue to sell Indexed products for a little while, at least. Long term, of course, the landscape will change, perhaps dramatically. The rules aren;t set to go into effect for another two years: it'll be interesting to see what impact this will have on production numbers between now and January 12, 2011.
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