In the article “Clock Might Run Out On DOL Investment Advice Rule: Panel,” Insurance News Net reports that the Department of Labor (DOL) has a lot of work to do, and little time to do it, to turn its investment advice rule into a regulation that works for everyone in the insurance world. Benefits and executive compensation partner Brad Campbell gave the publication further insight on the rule and its problems and impacts on the insurance industry.
One issue, Campbell said, stems from the DOL's attempt to write rules that harmonize with the Securities and Exchange Commission's Regulation Best Interest.
"Unfortunately for the insurance industry, they modeled their [exemption] on securities law on Regulation Best Interest, and while that fits somewhat well for insurance transactions that involve securities variable products, it doesn't fit at all for ... selling fixed annuities from an independent insurance agent regulated under state law," Campbell explained.
Campbell acknowledged that time is an issue, as there may not be enough of it to do a major rewrite.
"Basically speaking, if a rule has been on the books for more than 60 days, to displace it, you have to do new notice and comment rulemaking," explained Campbell. "If a rule has been on the books less than 60 days, an incoming administration who dislikes the policy could fairly easily wipe it away."