Showdown Looms Over NY Push To Add Life Insurance To NAIC Rule

BOSTON — New York and California officials previewed a looming showdown today by pushing for life insurance to be added to an annuity sales rule model law.

A National Association of Insurance Commissioners’ annuity working group is hashing out the details of a sales rule that will apply to annuities only. The group declared life insurance outside its charge during a May 31-June 1 meeting in Kansas City.

Meanwhile, New York finalized a tougher rule that covers life insurance as well. Maria Vullo, New York superintendent of financial services, took aim at the working group decision.

“Certainly this committee should keep active in this and not just accept the working group’s report and move on,” she said at the Life Insurance and Annuities Committee meeting. “There’s no reason that the suitability should not apply to both, annuities as well as life insurance.”

The Life Insurance and Annuities Committee must vote to approve anything the working group recommends.

The working group met Saturday and made little progress. Chairman Dean Cameron said he wants another special meeting to hammer out the final language of the rule, and he announced a new goal of having the rule ready to present to the full committee by the NAIC Fall Meeting Nov. 15-18 in San Francisco.

“We are still making progress but have not accomplished everything that we need to. It’s moving rather diligently forward,” Cameron said. “We anticipate another meeting or two. I think we are working best when we can meet together collaboratively.”

California Insurance Commissioner David Jones expressed support for New York in the brief discussion.

“We ought to seize the moment here and figure out how to best add life insurance as well,” he said.

Before a lengthy discussion could ensue, Chairman Doug Ommen reminded the committee to stick to the agenda. An affirmative vote to accept the working group report concluded discussion of the issue.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at john.hilton@innfeedback.com. Follow him on Twitter @INNJohnH.

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