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DOL Fiduciary News: December 7, 2017

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'Phase 2' of DOL Rule Is Dead: Brian Hamburger

ThinkAdvisor; December 6, 2017

“Phase 2” of the Labor Department’s fiduciary rule is “dead,” Brian Hamburger, CEO of the regulatory consulting firm MarketCounsel, said during his opening remarks Tuesday at the firm’s annual summit in Miami Beach.

Hamburger told the 500 advisor attendees that “we’re going to table” addressing Labor’s fiduciary rule until next year's MarketCounsel Summit, noting that in the recently finalized 18-month delay, the rule’s “most critical aspects have been tabled, and that may spell the end of the rule.”

In the interim, the Securities and Exchange Commission, he continued, can “finally take on the [fiduciary] issue itself.”

In comments to reporters during a Tuesday media briefing, Hamburger noted that “there will continue to be ramifications” from the fiduciary rule as “Phase 1” of the rule is “alive and well. But the real major issues with respect to the DOL fiduciary rule are the Phase 2 issues,” which have been delayed. “In Washington, you know that the longer something stays on the vine the more susceptible it is to get picked off.”

Labor has “continually announced that they aren’t going to expend resources towards enforcement” of the rule, he continued.

3Q Annuity Sales Trends Defy Explanation

InsuranceNewsNet; December 6, 2017

Third-quarter overall individual annuity sales dropped 13 percent to $46.8 billion from a year ago, but there was no shortage of theories to explain why.

Money stayed on the sidelines, money moved into more flexible managed accounts, money rolled over from CDs and stayed there thanks to narrowing spreads, the partial implementation of the fiduciary rule roiled distributors, some money departed into the mutual funds, IRA contracts for variable annuities suffered compared to non-qualified money.

Still, none of these explanations seemed to offer adequate reasons for why billions of dollars drained out of the annuity pond.

Third quarter variable annuity sales fell 16 percent to $21.8 billion and fixed annuity sales shrunk 10 percent to $25 billion compared to the year-ago period, LIMRA reported.

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