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DOL Finalizes Fiduciary-Only Regime Plans

The U.S. Department of Labor has released its final version of the “Retirement Security Rule,” which has sparked controversy and concern among financial services professionals. NAFA’s president and CEO, Chuck DiVencenzo, expressed disappointment in the lack of improvements to the proposed rule despite feedback from industry stakeholders. The rule imposes a blanket fiduciary threshold for recommending annuities in rollover transactions and maintains a constrained PTE 84-24 prohibited transaction exemption.

The release of this rule has been criticized for disregarding the value of independent distribution, limiting savers’ choice in working with financial advisors, and hindering the ability to provide predictable lifetime income. Fixed annuity sales have seen record numbers in recent quarters due to market volatility and longevity risk concerns. Annuities offer a unique opportunity for retirement savers to protect their nest egg while generating a predictable stream of income.

With over $6.9 trillion in assets held in 401(k) plans, the new rule is expected to impact the ability of independent annuity professionals to assist Americans in securing their retirement savings. NAFA is committed to analyzing the final rule and exploring avenues to combat the regulatory overreach. The association works to promote awareness and understanding of fixed annuities, advocating for their benefits to consumers.

As the premier trade association for fixed annuities, NAFA educates industry stakeholders about the value of fixed annuities and represents every aspect of the marketplace. The association will continue to work closely with its membership, industry colleagues, and legal counsel to address the challenges presented by the new rule. For more information on NAFA and fixed annuities, visit http://www.nafa.com.

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