NAIFA members discuss financial security at the Capitol

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By Susan Rupe

Members of an industry professional association are in Washington today, educating lawmakers about the issues facing Americans’ financial security and using storytelling to get the message across.

The National Association of Insurance and Financial Advisors wraps up its 2024 Congressional Conference Tuesday with a visit to Capitol Hill to discuss issues facing the industry and the people it serves.

At an orientation session held Monday, Life Happens president Barbara Pietrangelo told the group they were in Washington for two reasons: 1) to educate lawmakers about the life insurance and financial services industry, and 2) to tell lawmakers stories about clients and how life and financial products helped them in a time of need.

NAIFA members also were given an update on the Department of Labor’s latest iteration of the fiduciary rule.

The Federation of Americans for Consumer Choice filed a lawsuit in a Texas federal court earlier to stop the DOL fiduciary proposal from taking effect.

The Retirement Security Rule was published April 25 in the Federal Register. It extends a fiduciary standard of care to most annuity transactions, with the initial requirements taking effect Sept. 23.

FACC is joined by several independent insurance agents in the lawsuit filed in the Eastern District of Texas. The court is noteworthy for being within the Court of Appeals for the Fifth Circuit, known for its conservative opinions, including a 2018 decision to vacate the previous fiduciary rule put forth by the Obama administration.

Further action on the DOL rule, “will now be in the courts,” said Scott Sinder, partner at the law firm Steptoe.

Congress also is getting involved in the DOL rule, said Jayne Fitzgerald, NAIFA director of government relations. The Congressional Review Act was enacted as part of the Small Business Regulatory Enforcement Fairness Act in 1996. The CRA requires agencies to report the issuance of “rules” to Congress and provides Congress with special procedures, in the form of a joint resolution of disapproval, under which to consider legislation to overturn rules.

Four such resolutions have been introduced in the House of Representatives and one has been introduced in the Senate, Fitzgerald said. “We do expect it will come up for a vote on both sides,” she said.

NAIFA takes aim at tax reform

NAIFA wants to focus its grassroots advocacy efforts “on things that will move forward,” said Diane Boyle, NAIFA senior vice president of government relations.

Tax reform is the biggest of those issues, she said.

Tax reform is expected to come up in Congress in 2025 as most of the individual tax cuts of 2017’s Tax Cuts and Jobs Act are scheduled to expire at the end of next year. The tax-writing committees are already preparing to consider the provisions that will expire; however, the results of the presidential and congressional elections in November will determine which direction these considerations will go.

NAIFA is advocating the need “for a stable tax system that continues to encourage Americans to plan and save for their future using the financial tools and products that policymakers have created through the tax code and favored for these purposes over the years.”

The association wants to ensure the continuation of the tax-free treatment of the inside build-up on whole life insurance, as well as the continuation of incentives to establish and participate in individual and employer-sponsored retirement plans. NAIFA also is advocating for the continuation of tax-preferred savings vehicles for education and emergencies, and favorable treatment of paid leave, long-term care and disability insurance.

In addition, NAIFA is advocating for continuing to exclude employer-provided health insurance from tax, as well as reasonable transfer taxes at death and equitable income tax treatment of pass-through small business income.

Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected]. Follow her on X @INNsusan.