Legislative Spotlight

September 2013 • Vol. 5, Issue 9

LEGISLATIVE SPOTLIGHT is produced by NAIFA and is supplied to the Society of Financial Service Professionals as a collaborative effort that seeks to raise federal and state regulatory awareness for financial service professionals. The essential purpose is to facilitate understanding and a more fruitful dialogue with constituents and/or clients with regard to these important issues.

Speaking as one, we can and will make a difference.

Comments on Legislative Spotlight: Contact Ron Panneton with comments or suggestions concerning this newsletter.

NAIFA Applauds House Passage of NARAB II

NAIFA applauds the House of Representatives for passing H.R. 1155, the National Association of Registered Agents and Brokers Reform Act of 2013 (NARAB II). The bill, passed by the House on September 10, 2013, would make it easier for agents and brokers to conduct business in multiple states while preserving state regulation of insurance. NAIFA and a number of its industry coalition partners sent a letter the previous week to every member of the House urging passage of NARAB II.

Currently, agents and brokers must be licensed in each state in which they do business. NARAB II would create a national-not federal-clearinghouse for insurance agents and brokers to obtain approval to operate on a multi-state basis. NARAB would be governed by a Board of Directors dominated by state regulators and would establish standards for membership that meet or exceed the existing requirements in any state. A prospective NARAB member would be required to be fully licensed in his or her home state and satisfy rigorous membership criteria for the national organization. An approved NARAB member could utilize the clearinghouse to obtain approval to operate in any other state.

“Passage of NARAB II would be a huge win for consumers,” said NAIFA President Rob Smith. “Insurance advisors often have relationships with clients going back years or even decades. This legislation would make it easier for insurance professionals to maintain these relationships even if they or the clients move to different states. While NARAB II keeps all of the state-based regulations in place to protect consumers, it would reduce unnecessary costs and burdens associated with being licensed in multiple states.”

A Senate version of NARAB II (S.534) is currently under consideration, and has bipartisan support.

Why It Matters: A high percentage of professional advisors have lost clients who moved to states in which they were not licensed. NARAB II would offer a common-sense solution to this problem.

To Learn More: Contact Jill Hoffman at jhoffman@naifa.org.

NAIFA Attends NAIC National Summer Meeting

The National Association of Insurance Commissioners (NAIC) held its 2013 Summer National Meeting in Indianapolis, Indiana from August 23-27, 2013. Overall attendance at the meeting was approximately 2000 insurance industry, regulator and consumer representatives. The below matters of interest to NAIFA and advisors among others were discussed and/or acted upon:

  • Health Insurance and Affordable Care Act Implementation- The NAIC adopted “FAQs” developed over the last year to assist state insurance regulators in responding to consumer questions about the ACA in general and health exchanges in particular.

    A Health Committee began work on developing a White Paper that will attempt to address questions likely to arise concerning the role of and interactions between licensed producers, navigators, and non-navigator assistance personnel.
  • Annuity Disclosure Model Regulation-The NAIC is in the final stages of concluding its work amending their Annuity Disclosure Model Regulation. The NAIC’s Executive Committee gave final approval to the content of the revised Buyer’s Guides for Deferred Annuities. NAIFA staff had worked closely on the changes to the Guides with the Working Group as well as with numerous interested trade groups. Its work having been completed, the Annuity Disclosure Working Group was disbanded.
  • Viatical (and Life) Settlements- The Viatical Settlements Working Group completed its work amending the existing NAIC Viatical Settlements Model Regulation which were needed to conform the Model Regulation to the revisions previously made to the Viatical Settlements Model Act in 2007. The full NAIC approved these revisions and the Viatical Settlements Working Group was disbanded.

Why It Matters: The issues discussed and acted upon at the NAIC’s meetings has a far reaching impact on the ability of NAIFA members and advisors everywhere to market to and serve the financial and security needs of the American consumer.

To Learn More: Contact Bill Anderson at wanderson@naifa.org.

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