Massachusetts has adopted an annuity sales standard update developed by the National Association of Insurance Commissioners.
The state Division of Insurance published the Suitability in Annuity Transactions regulation changes in the Massachusetts Register Friday.
At least 30 states have now implemented the changes, which are based on the U.S. Securities and Exchange Commission's Regulation Best Interest. Similar updates are pending in seven other states, according to the Insured Retirement Institute.
The current list of holdouts includes California, Florida, Indiana and New Jersey.
What It Means
If you're a financial professional in Massachusetts, you might face customer profiling requirements, and you might have to complete a training course by June 1.
The Background
The original annuity suitability rules required an annuity seller to verify that the annuities recommended to a customer suited the customer's needs.
The NAIC suitability update requires sellers to show that they have considered a wide range of annuities, acted in the best interest of the consumers involved, disclosed conflicts of interest and documented their actions.
