Benson: Learn To Live With NASD

Advanced life insurance sales professionals must "get comfortable" with regulation by the National Association of Securities Dealers, according to the former president of John Hancock Life Insurance Company.

"I don't think the NASD understands the insurance business, and I am sure we don't necessarily understand the NASD," James Benson, who is now head of a Southborough, Mass., financial planning firm, said here at the annual meeting of the Association for Advanced Life Underwriting, Washington.

"I am not sure we are going to be able to convince them to change all the rules, to take into account the complex nature of insurance transactions," Benson added. "But we have to live within the rules."

When an advanced life insurance sales professional talks about variable universal life, "we like to think of an insurance policy with some separate accounts," Benson said.

Meanwhile, NASD officials tend to think of a VUL policy as a security that has insurance features, and Mary Schapiro, the new chairman of the NASD, Washington, seems to think that everything in the financial services industry is a security, Benson said.

"And she's probably right," Benson said. "If we are registered reps, as we ought to be, we should think of ourselves as a securities business. And we are going to have to figure out how to understand and streamline this product."

The broker-dealer that an advanced life professional is associated with "has to be a better teacher of what this is like, and has to streamline compliance and help us get through a complex transaction," Benson said. "The broker-dealer has to be in the business facilitation business, not the business prevention business."

Benson: Learn To Live With NASD

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Benson: Learn To Live With NASD

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