FACC submits comments on proposed changes to R590-230, Suitability in Annuity Transactions, and applauds the Department’s efforts to adopt the updated version of the NAIC Model Regulation to enhance consumer protection and promote uniformity.
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The Honorable Tanji Northrup
Deputy Insurance Commissioner, FLMI, CIE
Utah Insurance Department
4315 S. 2700 West, Ste. 2300
Salt Lake City, UT 84129
RE: Proposed Revisions to R590-230, Suitability in Annuity Transactions
Dear Deputy Commissioner Northrup:
Thank you for the opportunity to comment on proposed changes to R590-230, Suitability in Annuity Transactions. FACC applauds the Department’s efforts to adopt the updated version of the NAIC Model Regulation to enhance consumer protection and promote uniformity.
However, we would like to call your attention to two deviations from the Model Regulation that perhaps are oversights but which we believe are important to correct.
- In R590-230-4, Duties of Insurers and Producers, subsection (1)(a)(iii), it appears the word “not” was dropped from the phrase that reads “may be considered in isolation.” The Model Regulation states that each factor may not be considered in isolation. It is of course the intent of the regulation that all factors be considered as a whole.
- In R590-230-4. Duties of Insurers and of Producers (1)(a), an important sentence is omitted that appears in the Model Regulation which states the following:
Producers shall be held to standards applicable to producers with similar authority and licensure.
We surmise this statement may have been overlooked in the course of reorganizing the provisions concerning what Care Obligation includes and does not include. We think it is critical this provision be re-incorporated because it ensures producers will be compared to producers with similar licensure and authority for purposes of determining compliance. It is one of several such clarifications the authors of the Model Regulation considered important to ensure fair and uniform enforcement.
Again we thank you for the opportunity to comment and would be happy as necessary to answer any questions.
Kim O’Brien, CEO