American Council of Life Insurers: Ohio Strengthens Protections for Annuity Consumers
Targeted News Service
Susan Neely and National Association of Insurance and Financial Advisors (NAIFA) Ohio President
Duane Borcherding made the following joint statement on a best interest annuity rule recently adopted by the
Ohio Department of Insurance: When retirement savers in
Ohio work with a financial professional, they should have confidence that person is acting in their best interest. This rule achieves this important goal by enhancing consumer protections while safeguarding access to information for lower- and middle-income savers. In 2019,
Congress recognized the significance of helping people create a personal pension using annuities by passing legislation making it easier to include them in workplace retirement plans. Access to information about annuities is vital for anyone looking for the peace of mind that comes from a retirement income they can t outlive.
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The Employee Benefits Practice is pleased to present the Employee Benefits Developments Newsletter for the month of January 2021.
U.S. Department of Labor Issues Final Prohibited Transaction Exemption Regarding Compensation for Fiduciary Investment Advisers of Retirement Plans and IRAs
Consolidated Appropriations Act, 2021 (CAA): Retirement Plan Relief
DOL Issues Proxy Voting Regulations for Plan Fiduciaries
Retirement Plan Elections/Consents: IRS Extends Temporary Relief From the Physical Presence Requirement for Participant Elections/Consents Witnessed by a Notary Public or Plan Representative
Court Dismisses COBRA Lawsuit
U.S. Department of Labor Issues Final Prohibited Transaction Exemption Regarding Compensation for Fiduciary Investment Advisers of Retirement Plans and IRAs
On December 15, 2020, the U.S. Department of Labor (the “DOL”) issued its highly anticipated
final prohibited transaction class exemption for fiduciary investment advice (the “Final Exemption”). The Final Exemption, which will be officially designated “Prohibited Transaction Exemption 2020-02,” serves two broad functions. First, in the preamble, the DOL provides its “Final Interpretation” of the five-part test under its 1975 regulation defining who is an investment advice fiduciary under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and Section 4975 of the Internal Revenue Code (the “Code”). Second, in its operative text, the Final Exemption makes available prohibited transaction exemptive relief for such fiduciaries, subject to certain conditions.
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It looks as if 2021 will be a busy year as states move to implement the NAIC 2020 revisions to the Suitability in Annuity Transactions Model Regulation (Model 275), or other duty of care measures. The below chart outlines the actual or proposed state activity, its status, and notable items insurers need to consider. As 2021 continues, more states are expected to revise their standard of conduct requirements.
State
Status