National Association of Insurance Commissioners Takes Action to Protect Annuity Consumers
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- State regulators update model to require insurers to act in customer's best interest
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In a meeting of the
The revisions clarify that all recommendations by agents and insurers must be in the best interest of the consumer and that agents and carriers may not place their financial interest ahead of in the consumer's interest in making the recommendation. The model now requires agents and carriers act with "reasonable diligence, care and skill" in making recommendations.
"These changes underscore the commitment of
The revisions incorporate a "best interest" standard into the model revisions that require producers and insurers to satisfy requirements outlined in a care obligation, a disclosure obligation, a conflict of interest obligation, and a documentation obligation. The model revisions also include enhancements to the current model's supervision system to assist in compliance.
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About the NAIC
As part of our state-based system of insurance regulation in
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