• Annuity Transaction Protections For Florida Seniors Could Be Extended to Consumers of All Ages Under Proposed Rule
  • May 28, 2014
  • Law Firm: Colodny Fass P.A. - Fort Lauderdale Office
  • Protections previously afforded only to Florida senior citizens involved in annuity transactions would be extended to consumers of any age under a proposed Rule scheduled to be considered by Florida Department of Financial Services, Division of Agent and Agency Services. The hearing will take place on June 17, 2014 if requested by a member of the public.

    Amended to conform with revisions to s. 627.4554, F.S. as provided by SB 166 enacted in 2013 (Chapter 2013-163, Laws of Florida), proposed Rule 69B-162.011, F.A.C. relates to suitability and disclosure in annuity investments and the related forms required.

    SB 166 substantially revised Florida consumer protection laws relating to the sales of annuities by incorporating the 2010 National Association of Insurance Commissioners ("NAIC") Suitability in Annuity Transactions Model Regulation.

    Set forth by Rule 69B-162.011, F.A.C., Forms DFS-H1-1980 and DFS-H1-1981 would be revised under the proposed Rule to reflect the standards, procedures and guidelines of the 2010 NAIC Annuity Suitability Model Regulation ("Model") and s. 627.4554, F.S.

    If requested by a member of the public, the June 17 hearing will be held at 10:30 a.m. in Room 116 of the J. Edwin Larson Building, 200 E. Gaines Street, Tallahassee, FL 32399.

    About the NAIC's Suitability in Annuity Transactions Model Regulation

    The NAIC adopted the Model to set standards and procedures for suitable annuity recommendations and to require insurers to establish a system to supervise recommendations so that the insurance needs and financial objectives of consumers are appropriately addressed.

    Specifically, the Model is intended to:

    1. Establish a regulatory framework that holds insurers responsible for ensuring that that annuity transactions are suitable (based on the criteria in Sec. 5I), whether or not the insurer contracts with a third party to supervise or monitor the recommendations made in the marketing and sale of annuities;

    2. Require that producers be trained on the provisions of annuities in general, and the specific products they are selling.

    3. Where feasible and rational, to make these suitability standards consistent with the suitability standards imposed by the Financial Industry Regulatory Authority (FINRA).