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Successful LHCA Meeting in Portland, OR

LHCA Portland OR

I am sitting in the Delta Sky Club in Portland, OR after a great LHCA meeting here.  I have had really positive experiences at LHCA meetings and some that are not so great. The meetings tend to be small, which is a great thing if the people there are excited to both ask questions and share information. This was one of those. The meetings that are not as good are the ones where the people in attendance don’t get up to the mic and share. If there are only a couple of people answering all the questions and many questions with minimal input, it is hard to feel great about the time spent. This meeting was the kind that makes it more than worthwhile to be there. In our office we have some new staff that are really talented and excited about the work and I see that we are not alone- the new attendees at this LHCA meeting shared that excitement and passion for the work we do. I am going home upbeat and invigorated to keep doing the work! 

I presented on NY’s Reg 187 as it relates to life insurance.  There were fabulous questions and comments about how the various company’s implementation efforts are going. I got great feedback on the presentation and that is always nice to hear.  The slides are being made available to LHCA attendees and are posted in our Standard of Care Center for members’ reference.  

My next presentation on Reg 187 will be at AICP’s E-day in Springfield, MA on June 12. That one will focus on the intersections and conflicts between Reg 187, Reg 210 and Reg 60.  I am sure that, too, will be a lively discussion and I am really looking forward to it.  I hope to see you there.  Of course, that deck will also be available for members at education.currincompliance.com in the Standard of Care Center.  

- Cailie

New Standard of Care Center

Compliance with annuity and life insurance standard-of-care regulations (e.g., suitability,best interest, fiduciary issues) just got A LOT easier!

Currin Compliance Services is excited to announce our new Standard of Care Center (SCC) — an online collection of materials on the various fiduciary standards and suitability regulations, including NY’s new Reg 187. We will be following and creating materials about the NAIC’s efforts to revise and adopt a new suitability model regulation as well.

We are looking at suitability and standard of care issues in small, manageable chunks due to the size and scope of those issues. Our expectation is that this will be an evolving field for a long time and many of us will be dealing with these issues well into the future. We are launching the SCC as a monthly subscription service. As a subscriber, you will continue to receive updates, new information, reference documents, and analysis about developments in this area with unlimited access as long as your membership is current. The lessons are short and to the point. The titles are descriptive so you can find the appropriate lesson quickly. You’ll be able to scan the list of lessons and pick the exact one that you need. Each lesson focuses on a single topic.

We invite you to take a look at the SCC Introduction and Free Sample lesson as a preview into our vision — a one-stop repository for audio/visual lessons with downloadable scripts, reference documents, and other resources on this important topic. If you don't already have an account on our education and training platform (CICEd), you'll need to create one (it is free and without obligation). A CICEd account gives you access to all of our free materials and resources, plus the opportunity to register for paid courses and subscriptions. 

If you're ready to subscribe to the SCC now, use code 10OFFMEMBER and receive 10% off your monthly subscription price. Instead of $950/month your member subscription price will be $855/month — but only if you subscribe BEFORE April 1st. As of April 1st, the subscription price will be $950/month.

Questions? Email info@currincompliance.com or call (518) 692-2494.

“1035 exchanges are about to get easier. Is that a good thing?”

This title is not original. It is the title of an article written by Greg Iacurci in InvestmentNews’ January 21, 2019 edition. It is an interesting piece about the effort to use technology to speed up the 1035 annuity-to-annuity transfer on a tax-free basis. Whenever I see 1035, I think replacement and when I think replacement, I think about Regulation 60 in NY. When I read this article, I kept thinking how likely it is to lead to Reg 60 violations and fines.

While not mentioned in the article, I am hopeful that those working on this streamlining effort are familiar with Reg 60 and its mandates. The article states “Annuity products are often derided as being expensive, complicated products, a criticism that’s compounded by cumbersome industry infrastructure that often creates a month-long exchange process. Technology can reduce the time line substantially, executives said, likely to within a week, start to finish.” That does not appear to be enough for all that is required by Reg 60.

Sheryl Moore, CEO of Moore Market Intelligence does point out that it is possible that “more bad actors would get missed” due to the streamlined process, and that is certainly true, but my concern is a compliance one. I do not see how it will be possible to comply with the disclosure requirements of Reg 60 within that process. So perhaps NY is outside the scope of these efforts? Perhaps once the rest of the country has successfully expedited the replacement process, pressure can be brought to bear on the NY DFS to revise Reg 60 to increase the speed of these transactions.

Review

However, that seems a long shot given recent experience with Reg 60 procedures filings. In most cases, if not all, an expedited process for replacements requires revisions to a company’s DFS-filed procedures. Those filings are reviewed in granular detail and changes are often requested along with every screen shot of an electronic process. If changes are also required to the application to accommodate a new process, the slowdown at DFS is dramatically increased. Both the policy form reviewers and Reg 60 reviewers hold these types of changes to an extremely rigorous scope of review, far in excess of anything that exists in the review of paper processes. The chance that 1035 exchanges will get easier in NY seems remote.