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DOL Fiduciary News: May 6, 2016

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Manulife doesn't expect major impact on John Hancock from DOL rule; Thursday, May 05, 2016 5:11 PM ET

The final fiduciary rule issued in April by the U.S. Department of Labor is not likely to have a significant impact on Manulife Financial Corp.'s John Hancock business, company officials said.

"I think the industry, in general, was pretty pleased with how the final rules came out," said John Hancock President and Manulife Senior Executive Vice President Craig Bromley during a conference call. "There are some parties in the industry that would prefer not have the rules at all, but in terms of the deal of consulting with industry and formulating their final opinion based on that consultation, I think there was certainly some easing up on some of the most orders, provisions and timelines."

Lincoln Financial: FIA World Now A ‘Long Bore Through A Hard Board’ 

InsuranceNewsNet; May 5, 2016

The CEO of a large variable annuity seller said Thursday he expects VAs will have a market advantage in dealing with the Department of Labor's fiduciary rule now that fixed indexed annuities were also added to the best interest contract standard.

Voya: Independent Agents to Suffer Under DOL Rule 

InsuranceNewsNet; May 5, 2016

Independent insurance agents and advisors not affiliated with a financial institution can expect to be “disenfranchised,” by the Department of Labor’s new fiduciary rule, a top executive with Voya Financial said Wednesday.

Agents, however, could find some relief if regulators amend the rule, which was issued in its final form last month.

AALU panelists fear unintended consequences of DOL rule; May 5, 2016

The Department of Labor’s April release of its conflict of interest (fiduciary) rule may be more far-reaching in its impact than critics feared.

Among the potential unintended consequences: the universal application of a core component of the DOL rule, the best interest contract or BIC, to all products and producers, irrespective of the rule’s scope

Insurance groups opposed to DOL fiduciary rule step up campaign spending 

InvestmentNews; May 5, 2016 @ 1:19 pm

Two insurance industry trade associations that oppose the Labor Departments' recently finalized investment advice rule have stepped up their political spending.

The American Council of Life Insurers has donated $734,000 to members of Congress to help fund their campaigns as of March 31, according to records filed with the Federal Election Commission. That amount exceeds what the group spent during the entire 2014 cycle: $663,600.

Broker-dealers could see higher share of fixed indexed annuity sales thanks to DOL fiduciary rule 

InvestmentNews; May 5, 2016 @ 1:35 pm

The sale of fixed indexed annuities through independent insurance agents, by far the largest source of FIA distribution, is likely to take a hard hit as a result of the Labor Department's fiduciary rule, and some believe insurers may lean more on other channels such as broker-dealers and banks in this eventuality.

Don't Let BICE Hubbub Drown Out Burden of DOL Best Interest Standard 

ThinkAdvisor; May 5, 2016

By Fred Reish, Partner, Drinker Biddle & Reath

Much attention has been given to the DOL’s new fiduciary rule for retirement plans, IRAs and rollovers. In particular, people have focused on the requirements for the Best Interest Contract Exemption (BICE), which applies to compensation received for recommendations of investment and insurance products.

While the BICE requirements are substantial, they are placed primarily on the “financial institution” (for example, the broker-dealer or RIA firm). The BICE requirement for individual advisors is much more limited.

Fiduciary rule compliance to require ‘all hands on deck’ 

Employee Benefit News; May 05 2016, 5:48am EDT

The Department of Labor’s final fiduciary rules will have far-reaching consequences, even for organizations that don’t feel the rules apply to them. Plan sponsors must also take care because as part of their fiduciary responsibilities they need to monitor what their retirement plan service providers and advisers are doing to make sure they are in compliance with the rules.

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