On July 18, 2018 Maria T. Vullo, New York Financial Services Superintendent, announced the adoption of certain amendments to Insurance Regulation 187, which requires insurers to establish standards and procedures for agent recommendations to consumers with respect to annuity contracts and life insurance policies to best address the insurance needs and financial objectives of the consumer. The regulation further provides that Insurers and Producers are to act in the best interest of the consumer, and are doing so only when the interests of the consumer are considered in making a recommendation.
In the New York State Department of Financial Services (DFS) Press Release, the DFS noted that the “best interest” amendments are intended to “fill in regulatory gaps to protect New York consumers from the elimination of the federal Department of Labor’s Conflict of Interest Rule, which the Trump Administration failed to protect on appeal after a ruling from the U.S. Fifth Circuit Court of Appeals and also supplements existing consumer protections that already exist in New York, including setting reasonable limits on compensation and compensation transparency for the sale of a life insurance or annuity product in New York State.”
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