DOL Fiduciary News: June 26, 2017
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Insurers Report Minor Issues from DOL Rule
InsuranceNewsNet; June 23, 2017
Insurance company executives reported minor disruptions Thursday to agents and distributors two weeks into the first phase of the Department of Labor’s fiduciary rule.
Sales of annuity products were still “flowing in” from agents selling annuities into retirement plans, said Ray Wasilewski, chief operating officer, Life Companies, for FBL Financial Group.
FBL is a top seller of insurance in the Midwest. One of the company’s annuity products, however, was suspended as the commission was too low and it made no sense to raise the commission on it, Wasilewski explained.
“All of our products in qualified plans are DOL-ready,” he said.
Expect delay of fiduciary rule’s full implementation, Fred Reish says
BenefitsPro.com; June 23, 2017
A prominent fiduciary expert is predicting that the January 1, 2018 scheduled compliance date for the Labor Department’s fiduciary rule’s prohibited transaction exemptions will be delayed for up to a year.
Writing in a blog post, Fred Reish, chair of the financial services ERISA Team at Drinker Biddle & Reath, said the extent of the review of the rule being undertaken by the Labor Department and the requirements of the Administrative Procedures Act make it highly unlikely that a revised regulation will be finalized before the beginning of next year.
Labor is expected to formally publish a request for information for input on the rule’s impact on industry and what changes may be needed. Specifically, Labor is looking for feedback on two of the rule’s primary prohibited transaction exemptions: the Best Interest Contract Exemption, and Prohibited Transaction Exemption 84-24, both slated for implementation on January 1 of next year.