Missouri Enhances Protections for Annuity Consumers

WASHINGTON - American Council of Life Insurers (ACLI) President and CEO Susan Neely and National Association of Insurance and Financial Advisors (NAIFA)-Missouri President Craig Wright issued the following joint statement on the best interest annuity rule adopted today by the Missouri Department of Insurance:

"The new rule adopted by Director Chlora Lindley-Myers and the Missouri Department of Insurance strengthens safeguards for consumers seeking lifetime income through annuities.

"Today's actions takes us one step closer to nationwide adoption of the 'best interest of consumer enhancements' in the National Association of Insurance Commissioners (NAIC) Suitability in Annuity Transactions Model Regulation. To date, 46 states accounting for over 90% of the U.S. population have adopted a best interest standard for annuity sales. These bipartisan laws and regulations also align with the SEC's Regulation Best Interest, providing consumers with robust safeguards at the state and federal level.

"Unlike the ill-advised fiduciary-only approach adopted by the U.S. Department of Labor, these pro-consumer measures protect retirement savers without limiting their access to information about annuities, the only financial product in the marketplace that can provide guaranteed income for life. The regulation resurrects a failed 2016 regulation that, before it was vacated by a federal court, led to more than 10 million American workers' accounts, with $900 billion in savings, losing access to professional financial guidance.

"Limiting people's options for retirement is bad public policy, especially with more than 4.1 million Americans turning 65 each year through 2027. Most of these individuals will not have a defined benefit pension that provides a regular monthly income in retirement.

"The best interest standard adopted in Missouri and other states ensures that retirement savers, particularly financially vulnerable middle-income Americans, can access information about different choices for long-term security in retirement. A consumer survey finds that middle-income retirement savers would be very concerned about a regulation keeping them from accessing the professional financial guidance they want and need.

"The U.S. Congress reaffirmed the importance of lifetime income when it passed legislation in 2019 and 2022 that made it easier for employers to include annuities in workplace retirement plans. With these enhanced state and federal consumer protections, millions of savers across the country can be confident that financial professionals must act in the consumer's best interest when offering recommendations about annuities.

"We hope the remaining states will implement these sensible protections so that consumers everywhere can benefit from a best interest standard."

About ACLI: The American Council of Life Insurers (ACLI) is the leading trade association driving public policy and advocacy on behalf of the life insurance industry. 90 million American families rely on the life insurance industry for financial protection and retirement security. ACLI's member companies are dedicated to protecting consumers' financial wellbeing through life insurance, annuities, retirement plans, long-term care insurance, disability income insurance, reinsurance, and dental, vision and other supplemental benefits. ACLI's 275 member companies represent 93 percent of industry assets in the United States.

About NAIFA: Founded in 1890 as The National Association of Life Underwriters, NAIFA is the oldest, largest, and most prestigious association representing the interests of financial professionals from every Congressional district in the United States. Our mission - empowering financial professionals and consumers with world-class advocacy and education - is the reason NAIFA has consistently and resoundingly stood up for agents and called upon members to grow their knowledge while following the highest ethical standards in the industry.