DOL: No date scheduled to release fiduciary advice rule

The Department of Labor has sent its fiduciary rule to the Office of Management and Budget.

By John Hilton

The Department of Labor has no confirmed date to release its highly anticipated fiduciary rewrite, a spokesman said today.

Anticipation spiked following a Nov. 23 report that the department was preparing to publish the new rule as early as this week. Industry insiders say privately they will be surprised if the rule is made public before early 2023.

Much is on the line for an industry seeking to avoid a pure fiduciary standard government the sale of life insurance and annuities using retirement dollars. Industry critics say such a rule will only chill middle-market access to financial advice and products necessary for retirement security.

The DOL’s spring 2021 Regulatory Agenda confirmed that it will rewrite the definition of fiduciary. Ever since, the Employee Benefits Security Administration has likely been working on the rule update.

During a webinar earlier this month, Brad Campbell, partner at Faegre Drinker law firm, said the DOL does need to get the rule out there soon. As the halfway point of President Joe Biden's term nears, the pressure increases to speed along the rulemaking, Campbell explained.

"If they're going to propose a new fiduciary rule and propose changes to the existing exemptions, that really needs to happen in the next several months, if that's going to be a project they have enough time to handle properly," Campbell explained. "Essentially, the first six months of next year is when we need to see a proposal come out if they're going to meet their deadlines."

Otherwise, we could see a Republican administration come in after the 2024 election and reverse all rulemaking to that point.

Virtually the only thing left for the DOL to do with its fiduciary definition rewrite is to essentially make all first-time advice fiduciary, Faegre Drinker analysts agreed during a previous webinar.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.