____________________Circular 230 disclosure: This document was not intended or written to be used, and cannot be used, to: (1) avoid tax penalties, or (2) promote, market or recommend any tax plan or arrangement.

AAmerican Council of Life Insurers101 Constitution Avenue, NW, Washington, DC 20001-2133 (202) 624-2378 t (866) 953-4149 f jimszostek@acli.com www.acli.com

James Szostek Vice President, Taxes & Retirement Security

July 21, 2015

Submitted Electronically

Office of Regulations and Interpretations Office of Exemption Determinations Employee Benefits Security Administration Attn: Conflict of Interest Rule, Room N-5655; D-11850; D-11712 U.S. Department of Labor 200 Constitution Avenue, NW Washington, DC 20210 Subject: Definition of the Term “Fiduciary”; Conflict of Interest Rule—Retirement Investment Advice (RIN

1210-AB32); Proposed Amendment to and Proposed Partial Revocation of Prohibited Transaction Exemption (PTE) 84-24 for Certain Transactions Involving Insurance Agents and Brokers, Pension Consultants, Insurance Companies and Investment Company Principal Underwriters (RIN 1210-ZA25); and Proposed Best Interest Contract Exemption (RIN 1210-ZA25)

Greetings:

On behalf of the American Council of Life Insurers (“ACLI”)1, we offer comment on the Department of Labor’s (“Department”) proposed rule and prohibited transaction exemptions promulgated under Sections 3(21)(A)(ii) and 2510.3-21 of the Employee Retirement Income Security Act (“ERISA”)(collectively, the “Proposal”). The Proposal would cause irreparable harm to small balance retirement plan investors, including many middle and lower income investors. More specifically, the Proposal would effectively limit or deny access to guaranteed income products that are increasingly important to millions of Americans who no longer have access to a traditional pension.

1 The American Council of Life Insurers (ACLI) is a Washington, D.C.-based trade association with 284 member companies operating in the United States and abroad. ACLI advocates in federal, state, and international forums for public policy that supports the industry marketplace and the 75 million American families that rely on life insurers’ products for financial and retirement security. ACLI members offer life insurance, annuities, retirement plans, long-term care and disability income insurance, and reinsurance, representing more than 90 percent of industry assets and premiums. ACLI member companies offer insurance contracts and other investment products and services to qualified retirement plans, including defined benefit pension and 401(k) arrangements, and to individuals through individual retirement arrangements (IRAs) or on a non-qualified basis. ACLI member companies also are employer sponsors of retirement plans for their own employees.

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Executive Summary and Index of ACLI Comments

Introduction and Key Principles (pp. 5-7)

It is essential that revisions be made to the Proposal to:

o Ensure that providers, plan sponsors, plan fiduciaries, and IRA owners retain the freedom to define the nature and scope of their relationship.

o Preserve and expand the investment education principles of Interpretive Bulletin 96-1 which have served participants well for nearly 20 years.

o Preserve reasonable and customary commission-based practices with an exemption that offers compliance certainty and avoids increased costs.

o Be protective of the interests of savers and retirees through a workable rule that not only addresses conflicts of interests, but supports and encourages key educational activities when interests align.

o Encourage access to a savings plan at work and provide the opportunity to learn about and access annuities, the sole means available in the market place by which retirees can secure income for life.

o Ensure access to important workplace benefits such as life, disability income, long-term

care, and other non-medical insurance products.

o Enable insurers and their distribution partners to engage small business owners to encourage them to establish savings plans for employees.

o Encourage access to annuities for workers and retirees so that they may save and secure additional guaranteed lifetime income beyond Social Security.

o Base the cost-benefit analysis on a carefully examination of the impact of the rule on the

availability of annuities and workplace benefit insurance products.

Specific Comments on the Fiduciary Proposal

I. The Proposal’s definition of “advice” is unnecessarily broad and should be narrowed and/or clarified (pp. 7 – 11) A. The Department should clarify that advice “individualized to the advice recipient” is not

simply personalized, but is advice that implicates relationships of trust and expectations of impartiality, as described in the Proposal (pp. 7 - 8)

B. “Directed to” is not synonymous with “individualized” advice and should be eliminated from the definition (p. 8)

C. The regulatory definition should clearly link fiduciary advice with a contemporaneous transaction (pp. 9)

D. Clarify agreements, arrangements, and understandings are to be mutual (p. 9)

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E. The regulatory definition must more closely align itself with the statute and past practice

in focusing on activities which are “investment” in nature (p. 9 - 10)

F. The regulatory definition should be revised to exclude welfare benefit plans (p. 10)

G. Suggested edits to the Proposed §2510.3-21 definition of “Fiduciary” and addition of two new terms to clarify application of the rule (pp. 10 – 11)

II. The proposed exceptions or “carve-outs” are unnecessarily narrow, inconsistent with policies to expand retirement coverage and savings, and generally disruptive to the marketplace, without any discernible economic or other net benefit to consumers (pp. 11 – 18)

A. The counter-party carve-out should be expanded to cover all plans and IRA accounts (pp.

12 -14)

B. The platform carve-out should clarify that an annuity contract is a “platform or similar mechanism” and should be extended to IRAs (pp. 14 – 15)

C. The Proposal should include an exception for financial professional responses to proposal requests (pp. 15 – 16)

D. The education carve-out should be amended (pp. 16 – 18) 1. The availability of distribution guidance should be expanded 2. Education regarding features inherent in previously-purchased products should

be included in the carve-out 3. Education as to which investment options fit into various asset classes should be

permitted 4. “Anti-cashout” interventions should be included in the carve-out

III. PTE 84-24 must be revised to ensure sufficient exemptive relief for annuities and other

insurance contracts (pp. 18 – 22)

IV. The Best Interest Contract Exemption (BICE) must be revised and re-proposed since, absent substantial changes, it has no utility for the insured retirement industry (pp. 22 – 39)

A. The impartial conduct standards that form the foundation of the BICE are unacceptably

ambiguous (pp. 26 – 31) 1. The BICE is not clear as to which forms of variable compensation are permissible 2. The prohibition on differential compensation should be eliminated 3. The Proposal should utilize one definition of reasonable "and customary" 4. The structure of the BICE makes compliance uncertain and therefore,

unworkable 5. The definition of Financial Institution and the imposition of fiduciary status

through the BICE, not the definition of fiduciary, are unacceptable

B. Even if the compliance ambiguities were clarified, the technical requirements under the BICE render the exemption unworkable in the absence of significant changes (pp. 31 – 39)

1. The Best Interest contract standard as drafted is unduly restrictive and impractical

2. The BICE pre-recommendation contract requirement is incompatible with customary business practices in the financial services industry, and is simply impracticable

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3. BICE contracts should be subject to negative consent and should not require the adviser to be a party

4. The narrow scope of the exemption will eliminate an adviser's ability to provide advice to certain small plans and plan participants eligible for a distribution

5. The BICE has implications under Investment Advisers Act for agents and brokers that enter BICE agreements acknowledging fiduciary status

6. The exception's requirements for advisers that offer a limited range of investment options or proprietary products render it unfeasible

7. The required BICE disclosures should be harmonized with other disclosures 8. Forego a "low cost" prohibited transaction exemption 9. The BICE language, at various points, should be amended to target actual, rather

than perceived, conflicts

V. The proposed transition rule should be revised and expanded (pp. 39 - 40)

VI. Eight month delayed applicability date is unreasonable (p. 40)

VII. The cost-benefit analysis in the proposal is deficient (pp. 40 – 56)

A. Executive, statutory and judicial precedent (pp. 40 – 42)

B. Measuring the regulatory impact analysis against executive, statutory and judicial precedent (pp. 42 – 49)

1. The statement of potential benefits is flawed 2. The Proposal inflicts an “advice gap” on individuals who can no longer obtain

financial advice 3. Insufficient analysis of direct costs 4. The cost-benefit analysis does not consider annuities

C. The Proposal unacceptably excludes the protections of the current regulatory framework

from its quantification of need (pp. 49 – 50)

D. The status of non-cash compensation regulation (pp. 51 – 52)

E. Commissions compared to fee-only investment advice (pp. 52 - 53)

F. Correcting observations of fact and law (pp. 53 – 55)

G. Concluding observations about the Proposal’s fulfillment of executive, statutory and judicial standards governing cost-benefit analyses in rulemaking (pp. 55 – 56)

Appendix

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IIntroduction and Key Principles ACLI has long supported responsible regulation that brings confidence to the marketplace. We believe such regulation is a win-win, a win for consumers and a win for ACLI member companies, who take pride in offering savings and investment services and retirement income solutions to millions of Americans. However laudable the goal of this particular rulemaking, care must be taken to ensure that unintended consequences do not serve to deprive or limit access to the products and services Americans need for meaningful savings and a secure retirement. Caution is particularly appropriate when considering rules that will significantly limit access to investment information, assistance, education and guidance, as well as to important income protection products. While the Department estimates – for purposes of the Proposal - investor losses due to conflicts at $21 billion per year (somewhat higher than the Council of Economic Advisor’s estimate of $17 billion per year), investor losses associated with an absence of professional assistance, according to the Department’s own figures, were estimated to be $114 billion in 2010 alone,2 almost seven times greater per year. Without significant changes to the Department’s Proposal, ACLI is concerned that there will be a dramatic decrease in:

access to guaranteed lifetime income solutions; the number of small business retirement plans; access to important workplace benefits such as life, disability income, long-term care, and other non-medical insurance products; and investment and distribution education and guidance.

These results will come at a cost to plan sponsors, participants, beneficiaries and IRA owners far in excess of the Department’s estimates. In summary, unintended consequences should – and do – matter.

ACLI supports rulemaking that is consistent with the Department’s statutory authority, accommodates the Department’s interest in minimizing the impact of conflicts of interest on plans, participants and IRA owners, and avoids significant disruptions in access to saving and retirement products and services. At a minimum, a rule defining “fiduciary” status for purposes of investment advice should:

Ensure that service providers, financial professionals, plan sponsors, plan fiduciaries, plan participants and IRA owners retain the freedom to define the nature and scope of their relationships, including the freedom to sell, purchase, negotiate and contract without a regulatory presumption of a fiduciary relationship and without codifying assumptions regarding the assumed competence – or lack thereof – of any group of plan fiduciaries or the general public. Preserve reasonable and customary commission-based practices with an exemption that offers compliance certainty and avoids increased costs. Narrowly focus on persons who provide advice regarding investments.

2 76 Fed Reg 66151 (October 25, 2011). While the Department estimated reductions in that figure resulting from advice provided pursuant to the statutory exemption under ERISA section 408(g) and Internal Revenue Code section 4975(f)(8), the fact is that the exemption is not relied upon heavily, therefore any likely reductions in investor losses attributable to their own errors would be marginal.

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Preserve and expand the current rules regarding investment education in the Department’s Interpretive Bulletin 96-1, the benefits of which were recognized by the Department in 2010 and have served participants well for nearly 20 years. To protect the interests of savers and retirees, there must be a workable rule that not only

addresses conflicts of interests, but supports and encourages activities when interests align. For example, the insurance industry and its distribution partners encourage greater savings, which can help Americans secure life-long income. Both industry and the saver benefit when that goal is achieved. This alignment of interest must be fostered, not encumbered. Likewise, retirees need a variety of guaranteed lifetime income solutions from which to choose the level of security they desire and for which they are willing to pay. Rules and exemptions should not frustrate, through expressed limitations or ambiguity and uncertainty, this alignment of interests. To do otherwise would harm, not help, the interests of savers and retirees.

With so many Americans reaching retirement age each day and given the decline of traditional employer-sponsored pension plans, now more than ever, seniors need the income protection available in annuities and other guaranteed lifetime income products offered by America’s life insurance industry. Many people first learn of the benefits of annuities from a life insurance agent or broker. Continued access to information and education regarding annuities is consistent with the Administration’s efforts to facilitate access to lifetime income. However, if the Department’s fiduciary proposal moves forward without substantial changes, Americans’ understanding of and access to guaranteed lifetime income in retirement will be effectively limited, and longstanding and customary practices involving retirement plan and IRA guidance will be prohibited.

Annuities are the sole means available in the market place today by which retirees can secure income for life. With fewer and fewer workers eligible for workplace pensions, there is a greater need to save for retirement in 401(k) and other defined contribution plans as well as IRAs. Annuities serve as a means to convert these savings into a personal pension to supplement Social Security. To ensure that Americans have a secure retirement, it is of utmost importance that they have access to a savings plan at work and the opportunity to learn about and access annuities. Without substantive changes, ACLI is seriously concerned that, under the proposal, insurers and their distribution partners will no longer be able to engage small business owners to encourage them to establish savings plans for employees. Without access, workers are less likely to save and secure additional guaranteed lifetime income beyond Social Security.

Annuities are not well known by the general public. Academics write of the “annuity puzzle,” i.e., why so few retirees annuitize defined contribution benefits when annuities provide much needed income protections. Research shows that people have difficulty placing a value on annuities.3 They underestimate the value of the annuity when considering a purchase. This adds to the challenge faced by insurers, agents and brokers. They must introduce savers and retirees to annuities, help them to understand the value proposition, and educate them on the variety of annuities available with features that can address concerns regarding liquidity, inflation, premature death, etc. Given the need for a high level of education about annuities and the buy and hold nature of guaranteed lifetime income products, it is important that the Department recognize that these elements led to the customary compensation practices in place which differ from those that govern the sale of other types of investments or investment advisory and management services. ACLI members are gravely concerned that the Proposal, as currently drafted, will drive distributors to level compensation structures that will no longer appropriately compensate agents for the sale of annuities which in turn will result in less access by the public to these important retirement security products.

3 “Cognitive Constraints on Valuing Annuities” by Brown, Kapteyn, Luttmer, Mitchell – Pension Research Council October 2014.

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When writing rules, agencies are required to “strike the right balance” and develop more affordable, less intrusive rules to achieve the same ends, giving careful consideration to benefits and costs. While the Proposal mentions annuities 172 times, acknowledges that “31 percent of IRAs include investments in annuities,” and notes that “insurance companies [will] be significantly affected by the proposal,” the cost-benefit analysis fails to examine the impact of the Proposal on insurers, the annuity market, or on the availability of lifetime income. Finally, it is well recognized that workplace saving programs play a critical role in retirement preparedness. As leading providers in the small plan formation marketplace, life insurers are particularly concerned that this Proposal would impede the important policy goal of expanding small plan coverage. The Proposal negatively impacts small plan formation by restricting sales activities that encourage small business owners (those with less than 100 employees) to start, maintain, or improve their employee benefit plans. The DOL has limited the “sales exception” to certain large plans, while impeding the sale of products and services to small businesses. Only 50 percent of workers employed in small businesses have access to a workplace retirement plan. There needs to be greater incentives for these small businesses to start and maintain retirement plans—not new barriers. The Fiduciary Proposal

We share the Department’s interest in seeing that plan sponsors, plan participants and IRA

owners receive advice that is in their best interest. At the same time, we are concerned that, in its pursuit of this objective, the Department has crafted a proposal that creates risks and uncertainties for insurers, their agents, and brokers that may result in less, not more, investment and annuity information. Our comments are consistent with the Department’s objective of protecting retirement investors while avoiding unnecessary disruption and negative impacts to plans, participants and individuals.

Plans, plan participants and beneficiaries, IRA owners and small business owners need a financial services market place that engages them and assists them in saving and investing and in addressing critical needs for income in retirement. An unnecessarily narrow focus on conflicts of interest oversimplifies the massive undertaking this nation faces in getting workers to save and retirees to secure guaranteed lifetime income. Insurers, agents, brokers, and savers/investors need to have confidence that a fiduciary standard will not disallow the reasonable and customary payment of sales commissions and other traditional forms of distribution-related compensation nor expose them to unnecessary litigation. This is required to ensure that American retirees maintain free and unfettered access to educated and committed financial intermediaries. Parties engaged in transactions with ERISA plans and IRAs need clear, unambiguous rules by which to determine their duties and obligations in order for them to effectively and confidently serve the marketplace and to ensure that plans, plan participants, and IRA owners continue to have access to a broad range of insurance products and services, investment advice and educational services. We offer these comments to assist in the development of such rules. However, given the voluminous and complex nature of the Proposal, we intend to continue our review and may submit additional or supplemental comments to the Department.

I. ACLI members are concerned that the definition of “advice” is unnecessarily broad and provides the following recommendations for the Department’s consideration.

A. The Department must clarify that advice “individualized to the advice recipient” is not simply personalized, but is advice that implicates relationships of trust and expectations of impartiality, as described in the Proposal.

The current regulatory definition provides that, in order to be considered a fiduciary by nature of providing investment advice, a person must “ render individualized investment advice to the plan based on the particular needs of the plan regarding such matters as, among other things, investment policies

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or strategy, overall portfolio composition, or diversification of plan assets.”4 The degree of clarity in the existing definition has allowed the investment advice community to draw clear distinctions between advice that may be personalized, but not “individualized to” an advice recipient for purposes of ERISA. This would include general investment communications delivered via targeted sales calls, individually addressed marketing materials, or brochures selected and distributed in an effort to match informational content with a particular investor’s potential needs. Simply adding a salutation to the beginning of a letter should not be deemed to be “individualized” although it might be considered “personalized.” Instead, “individualized to the advice recipient” should be read to include recommendations that take into account a particular individual’s unique circumstances. It would be helpful if the Department clarified this interpretation in the preamble of the regulation. In order to clarify the Department’s intent, we recommend adopting language outlined in the preamble to describe the relationships that the Department seeks to cover – specifically, those relationships that create an expectation of trust between the financial professional and the investor. Section I(G) includes suggested changes to the text of the Proposal to address this point.

B. “Directed to” is not synonymous with “individualized” advice and should be eliminated from the definition.

We believe the “directed to” concept adds complexity and ambiguity to investment advice determinations that will only serve to significantly limit one-on-one communications between providers and potential or existing customers. The Department itself cited studies that show historically in-person engagements may produce benefits that are not afforded by similar on-line services.5 The ACLI sees no benefit to plan sponsors, plan participants or IRA owners of discouraging one-on-one or other personal contacts given their obvious value toward understanding products, services, and choices. The investment advice industry has long functioned under the premise that “investment advice” that creates a trusted relationship between the financial professional and an investor must be customized and deemed suitable for and based on the needs of the specific investor. The Department’s decision to capture communications that are merely “directed to” the recipient upends traditional passive marketing activity that is often the primary way by which investors become aware of their product and service options. In effect, the inclusion of “directed to” serves to create a presumption of investment advice/fiduciary status, in circumstances when neither was intended, expected or agreed upon. Further, the lack of clarity within the rule will have a chilling effect on all types of marketing activity, because the line between traditional marketing and fiduciary investment advice cannot be determined in advance with any degree of certainty. Directed communications, by definition, are not “individualized” communications, and should not be treated as individualized for purposes of determining ERISA fiduciary status. For instance, directed mailings, general advertising focused in specialty markets, group communications that are focused on the needs of investors of a particular age, marital status, or demographic region, and general investment seminars open to members of a particular organization or community are all advice communications that may be “directed to” a recipient, but should not be treated as an attempt to offer fiduciary investment advice. Accordingly, the definition should be limited to fiduciary advice that is truly “individualized” and understood to be “individualized” by the parties. Again, the “directed to” language should be eliminated. Section I(G) includes suggested changes to the text of the Proposal to address this point.

4 42 CFR 2510.3-21(c)(1)(ii)(B) 5 76 Fed Reg 66155 (October 25, 2011)

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CC. The regulatory definition must clearly link fiduciary advice with a contemporaneous transaction.

With the Department’s decision to significantly broaden the definition of “fiduciary”, including the elimination of certain tests that served to place parameters around the advice being rendered, such as the “regular basis” requirement, ACLI members are concerned that advice, when provided, may be construed by a plan sponsor, participant or IRA owner as on-going in nature, rather than constrained by context, events and/or time. Typically, a recommendation to engage in or refrain from taking a particular course of action is based on a variety of factors then prevailing. A financial professional should not be liable for transactions that occur after a change in the relevant factors (e.g., market conditions, interest rates). In this regard, we recommend that the Department make clear that, as part of an agreement or understanding, the parties are free to define the period to which the advice applies. We also recommend that, in the absence of any such agreement or understanding, there is presumption that the advice will be acted upon within a time frame that is reasonably contemporaneous in light of the type of recommendation given with the rendering of the advice, in the absence of facts to the contrary.

D. Clarify agreements, arrangements and understandings are to be mutual. A written or verbal agreement is, by its nature, mutual. So too is a written or verbal arrangement. However, an understanding may not necessarily be mutual. We suggest that “written or verbal” also affix to “arrangement” and that “mutual” be a condition of any understanding. Section I(G) includes suggested changes to the text of the Proposal to address this point.

E. The regulatory definition must more closely align itself with the statute and past practice

in focusing on activities which are “investment” in nature.

ERISA section 3(21)(a)(ii) states that a person is an investment advice fiduciary only to the extent that he provides ‘‘investment advice for a fee or other compensation, direct or indirect, with respect to any moneys or other property of such plan . . . ’’. The functional nature of this statutory definition limits the Department’s regulatory interpretation to certain activities that relate to the investment or management of assets. While the term “investment” has a number of meanings, to stay within the authority granted by Congress, the rule should be limited to advice regarding the investment of plan assets. The term “investment” should not include a contract issued by an insurance company for the provision of benefits under a welfare benefit plan such as a life, disability income, or long term care contract. Investment activities generally involve an expectation of achieving a profit. Thus, while these insurance contracts may be an investment as that term is used to describe a good use of resources, they are not investments as that term is used in the phrase “investment advice” under ERISA.

In addition, a recommendation regarding a person who may be willing to serve and might be hired as an investment advice fiduciary is not a recommendation regarding the investment of plan assets. Whether or not such person is to be “entrusted with investment authority” is a determination to be made by another party. The Department should not discourage parties-in-interest from helping plan fiduciaries identify other possible service providers.

Also, absent specific advice regarding investments, a recommendation regarding the distribution

of benefits is not investment advice. For example, a recommendation from a party-in-interest regarding the availability of a hardship withdrawal to a homeowner in need of funds to make repairs to her home after a major storm should not be construed as investment advice. While distributions do require investment activity, when investments are disposed to fund the proceeds of a withdrawal either in accordance with the terms of the plan or at the direction of the investor without a recommendation to do so, no “investment advice” has occurred.

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There is no indication that Congress intended or directed that the Department extend its

regulatory interpretation beyond advice regarding an investor’s portfolio or investment products. However, the Department’s current revision of the definition of investment advice appears to do just that, potentially capturing discussions relating to the purchase of products and activity never intended to be captured by this rule. This expansion of the statute not only is inconsistent with the Department’s interpretation of “investment advice” for any other purpose under ERISA, it is also a considerable expansion of the statutory language.

Finally, while we understand that a person may, through or together with an affiliate of such

person, “indirectly” represent or acknowledge that it is acting as a fiduciary, we cannot understand how one would indirectly render investment advice. The Department does not explain the application of the phrase “through or together with an affiliate.” Fiduciary status should not apply to persons that are not directly involved with the provision of advice. There is no reason why the status quo should change. ERISA §(3(21)) does not contemplate “indirect” investment advice.

Section I(G) includes suggested changes to the text of the Proposal to address these points.

F. The regulatory definition should be revised to exclude welfare benefit plans.

Furthermore, ACLI recommends that the Department exclude welfare benefit plans from

this rule, preserving both the current rule and prohibited transaction exemptions pending further analysis. Regarding welfare benefit plans, we note the lack of any analysis or explanation in the preamble to the Proposal regarding the application of law or the Proposal to these plans, an absence of any analysis of the impact of the Proposal on these plans in the Regulatory Impact Analysis, nor an attempt to conform the proposed new and amended prohibited transaction exemptions to provide clear exemptive relief to transactions involving these plans. Should the Department decide to act on rulemaking regarding these plans, we ask that the Department: (1) clearly identify the statutory authority to capture recommendations regarding the purchase of a contract to provide welfare benefits under the definition of “fiduciary investment advice” and seek public comment on its position; (2) afford the public an opportunity to comment on its regulatory impact analysis regarding the impact of such rulemaking to welfare benefit plans; and (3) propose prohibited transaction exemptions or appropriate amendments that conform to transactions involving welfare benefit plans. Section I(G) includes suggested changes to the text of the Proposal to address this recommendation.

G. Taken together, our suggestions in Section I would revise the base definition and add two

new terms to clarify the application of the rule as follows: § 2510.3-21 Definition of “Fiduciary.” (a) Investment advice. For purposes of section 3(21)(A)(ii) of the Employee Retirement Income Security Act of 1974 (Act) and section 4975(e)(3)(B) of the Internal Revenue Code (Code), except as provided in paragraph (b) and (g) of this section, a person renders investment advice with respect to moneys or other property of a plan or IRA described in paragraph (f)(2) of this section if— (1) Such person provides, directly to an investor a plan, plan fiduciary, plan participant or beneficiary, IRA, or IRA owner the following types of investment advice, whether one time or ongoing, in exchange for a fee or other compensation, whether direct or indirect: (i) A recommendation as to the advisability of acquiring, holding, disposing or exchanging investmentssecurities or other property, including a recommendation to take a distribution of benefits or that includes a recommendation as to the investment of assetssecurities or other property to be rolled over or otherwise distributed from the plan or IRA;

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(ii) A recommendation as to the discretionary management of investments by a party other than the party making the recommendation securities or other property, including recommendations as to the management of moneyssecurities or other property to be rolled over or otherwise distributed from the plan or IRA; (iii) An appraisal, fairness opinion, or similar statement whether verbal or written concerning the value of investmentsecurities or other property if provided in connection with a specific transaction or transactions involving the acquisition, disposition, or exchange, of such investmentsecurities or other property by the plan or IRA; (iv) A recommendation of a person who is also going to receive a fee or other compensation for providing any of the types of advice described in paragraphs (i) through (iii); and (2) Such person, either directly or indirectly (e.g., through or together with any affiliate),— (i) Represents or acknowledges, either directly or indirectly (e.g., through or together with any affiliate), that it is acting as a fiduciary within the meaning of the Act with respect to the investment advice described in paragraph (a)(1) of this section; or

(ii) Renders the investment advice pursuant to a written or verbal agreement, or arrangement, or mutual understanding that the advice is individualized or that such advice is specifically directed to, the advice recipient for consideration in making investment or management decisions with respect to securities or other property of the plan or IRA. to meet the specific investment goals of the investor, and is provided at the request of the investor pursuant to the agreement, arrangement, or understanding.

(f) Defintions. For purposes of this section – (2)(i) “Plan” means any employee benefit plan described in section 3(32) of the Act …. (9) “Investor” means a plan, plan fiduciary (with discretionary authority over plan assets), plan participant or beneficiary, IRA, or IRA owner. (10) “Investments” means securities, insurance and annuity contracts, property or other financial instruments held by a plan or IRA. The term “investments” does not include any contract issued by an insurance company for the provision of benefits under a plan described in section 3(1) of the Act . (g) Welfare benefit plans. For purposes of section 3(21)(A)(ii) of the Act, with respect to a plan described in section 3(1) of the Act, the definition of “fiduciary” set forth in §2510.3-21 as filed with the Federal Register on October 28, 1975 shall apply.

III. ACLI members are concerned that the proposed exceptions or “carve-outs” are unnecessarily narrow, inconsistent with policies to expand retirement coverage and savings, and generally disruptive to the marketplace, without any discernible economic or other net benefit to consumers.

According to the Proposal, the revised definition of investment advice fiduciary is subject to certain specific exceptions (referred to in the Department’s Proposal as ‘carve-outs’) for communications that are “best understood as non-fiduciary in nature” and that “parties would not ordinarily view as communications characterized by a relationship of trust or impartiality”.6 However, the proposed exceptions exclude critical details regarding investment activities that are not considered fiduciary in nature, or advance inaccurate assumptions regarding plan and investor activity that erode the efficacy of the exception. Furthermore, in order to preserve access to traditional assistance for retirement investors with smaller accounts, several specific exceptions must be included in the final rule.

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AA. The counter-party carve-out should be expanded to cover all plans and IRA accounts. According to the preamble, the purpose of the seller’s exception is to “avoid imposing ERISA

fiduciary obligations on sales pitches that are part of an arm’s length transactions where neither side assumes the counterparty to the plan is acting as an impartial trusted adviser, but the seller is making representations about the value and benefits of proposed deals.”7 The Department’s stated purpose recognizes that sales activities naturally include recommendations to purchase and invest in products and services offered by the seller, and that financial institutions such as life insurers and their sales representatives should not be categorized as fiduciaries under ERISA or Code section 4975(e)(3)(B) when they are engaged in selling activities and are clear that they are acting in a sales capacity.

Unfortunately, we do not believe the Department’s recognition of the distinction between sales

and advice in the preamble or in the Department’s prior proposal is adequately reflected in the limited scope of the sellers/counterparty carve-out in the operative language. In fact, rather than recognizing that marketing and sales activities do not constitute advice, the Department appears to start from the premise that those activities traditionally thought of as sales and marketing are tantamount to rendering investment advice---- unless such activities meet certain conditions, without regard, to any understanding or agreement on the part of the parties that such activities are in fact sales or marketing. And, to further confuse things, the Department, with no pertinent economic or other analytical support, opts to treat all selling and marketing activities as fiduciary investment advice when that activity is directed to small plans and IRA accounts; again, without regard to any understanding or agreement of the parties to the contrary.

We are concerned that the Department’s efforts go far beyond the statute in its interference into practices that are clearly recognized as the sales and marketing of products and services. We also are concerned with the apparent arbitrariness of the Department’s framework, as well the supposition that size is a substitute for understanding one’s responsibilities under ERISA, even if one is otherwise held accountable for understanding and compliance with the – reporting, disclosure, fiduciary, and prohibited transaction – rules.8 In essence, the Proposal creates a new second-class plan fiduciary for small plans and calls into question whether the Department would support a lower standard of care for small plan fiduciaries generally given this assumption that these employers lack sophistication. Similarly, we are concerned with the Department’s assumption, again with little, if any, support, that IRA owners generally are not sufficiently sophisticated to distinguish advice from sales and marketing. A simplified disclosure describing the sales function would be a much better option than forcing financial professionals to abandon the small balance investor. The approach pursued by the Department in the Proposal effectively eliminates for all plan sponsors, participants, IRA owners, the ability to acknowledge and define the parameters of their engagements with third parties. We believe this, and other aspects, of the Proposal go far beyond what Congress intended and far beyond what can be construed as a reasonable reading of the statute.

Most importantly, we are concerned that the Proposal will unnecessarily complicate interactions

with all plans, as well as increase operational and compliance costs for providers and their customers. Further, the inability to conduct traditional sales and marketing efforts to small plans will significantly impede, if not preclude, efforts to close the retirement coverage gap, which is particularly acute among small employers. As the Department is aware, millions of working Americans do not currently have retirement savings opportunities through their workplace. The Department’s Proposal will significantly increase costs and risks attendant to reaching out to the small employer community and, in our opinion, further exacerbate private-sector efforts to bring retirement savings opportunities to all working

7 80 FR 21941. 8 Under the proposal, the exception may apply to sales activities relating to an employer’s 120 participant 401(k) plan, but not the employer’s 65 participant defined benefit plan or 70 participant frozen welfare benefit arrangement. The exception may apply to sales activities relating to a $100 million dollar defined benefit plan trust, but not to sales of insurance contracts to a large unfunded welfare benefit plan.

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Americans. For many of the same reasons, the Department’s limits on sales and marketing to new and existing IRA owners will, in our view, increase the risk of leakage, thereby reducing retirement savings. An inability to reach out to potential and existing IRA owners in an efficient and cost effective way will leave far too many individuals and retirees on their own to gather information and materials about their options, while being subject to potentially competing demands from family and others to use accumulated savings for non-retirement purposes. Marketing and sales activities serve to educate consumers about their choices and ensure competitive pricing of products and services.

We recommend that the sellers/counterparty exception be modified to: Include sales to any investor. The definition should provide that, without regard to plan size or whether the engagement involves a plan participant or IRA owner, in the absence of a mutual understanding or agreement that products or services are being offered or marketed in a fiduciary capacity, such offerings or products shall be treated as sales/marketing not covered by the “advice” definition. Plan fiduciaries are, by law – and without regard to the size of their plan or the amount of assets within the plan -, required to act prudently and in the interest of the plan’s participants and beneficiaries. We believe that such standard imposes an obligation – and not a particularly difficult one – to ascertain the nature of the relationships in which they engage, including distinguishing a sales activity from a fiduciary activity (with respect to which they may have co-fiduciary liability). In the case of a plan participant considering a rollover or IRA owners generally, they too are expected to be cognizant of the rules and tax considerations governing IRAs and, in many cases, have reviewed the IRA marketplace in conjunction with selection an IRA with investments and fees that meet their criteria. Unlike plan participants, IRA owners have the flexibility – and therefore an inherent protection – to transfer their assets to a competing IRA if and when they become dissatisfied with investments and/or services. The knowledge and understanding of IRA owners should not be discounted by the Department in the absence of an empirical assessment of IRA owners’ capabilities and the impacts on the Departments regulations on those owners. Remove the requirement to obtain a written representation when acting in a sales capacity. The definition should be revised to eliminate any requirement for a seller/counterparty to obtain written representations regarding the capacity in which a plan fiduciary is acting (or regarding plan size, assets – see above) or the plan fiduciary’s understanding that the seller/counterparty is not acting in a fiduciary capacity. Such representations are not, and should not be, part of pre-sales or sales discussions. Starting any relationship with an explanation that the seller is not permitted to discuss product or service offerings until written representations are obtained, that the individual is in a position to act and that she is sufficiently sophisticated to understand that the seller is a seller, not a fiduciary – may be received as unwelcomed and condescending. Despite the Department’s perception, albeit unfounded, that no one is really capable of distinguishing sales from fiduciary activities, we believe such confusion has not been an issue of any measurable degree and that this requirement should be eliminated. Remove the burden of proof from the seller. The definition should be revised to eliminate putting a seller/counterparty in the position of having to establish/prove that any given fiduciary has sufficient expertise to evaluate the transaction and determine the prudence of the transaction with respect to the plan. We believe if a plan fiduciary is acting as such in connection with a sales or marketing engagement, it is reasonable for any seller/counterparty to assume that the fiduciary understands their duties under ERISA (or the in case of an IRA account owners, their right to act on information they determine to be in their best interest). Moreover, the Department does not provide guidance on how one could possibly discharge such an obligation with any degree of certainty. If the Department is intent on a test, we strongly suggest that the requirement be reframed to establish a presumption of competence on the part of a plan fiduciary, in the absence of clear evidence indicating otherwise. In this regard, we note that

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even ERISA fiduciaries – directed trustees – are not required to second guess the competence of a named fiduciary absent extraordinary circumstances.9 Certainly a seller/counterparty should not be held to a higher standard that a directed trustee. Remove any doubt that common pre-sale activities could be considered fiduciary advice. The definition should clarify that pre-sales activities, such as responses to RFP’s and similar solicitations in which a seller/counter is not initiating an action, but rather is providing information regarding products and services in the context of a request, the parameters of which are defined by a plan fiduciary or IRA owner constitute activities covered by the sale/counterparty exception. In the alternative, the current seller’s carve-out should be eliminated in favor of a carve-out that

requires the seller to fairly inform the investor that: (A) such person is not undertaking to provide impartial financial advice (i.e., not acting as a fiduciary for purposes of ERISA); and (B) such person has a financial interest in the matter. This approach achieves the Department’s stated goals without codifying assumptions regarding the assumed competence – or lack thereof – of any group of plan fiduciaries or the general public.

ACLI recommends the following revision to the text of the Proposal.

“§ 2510.3-21(b)(1)(i) Counterparties to the investor -- In such person's capacity as a counterparty (or representative of a counterparty) to an investor, the person provides advice to an investor who is independent of such person and who exercises authority or control with respect to the management or disposition of investments held by a plan or IRA, with respect to an arm's length transaction, if, prior to providing any recommendation with respect to the transaction, such person has not acknowledged in writing that it is acting as a fiduciary (within the meaning of this subsection) with respect to the transaction and the person does not receive a specific separate advisory fee for such recommendation; such person fairly informs the investor that: (A) such person is not undertaking to provide impartial financial advice; and (B) such person has a financial interest in the matter.”

B. The platform carve-out should clarify that an annuity contract is a “platform or similar

mechanism” and should be extended to apply to IRAs.

As with other carve-outs proposed by the Department, the platform carve-out is “designed to draw an appropriate line between fiduciary and non-fiduciary communications, consistent with the text and purpose of the statutory provisions.” The platform carve-out appears to be intended to allow platform providers who provide access to investments through a retirement plan platform and help plan fiduciaries select or monitor investment alternatives perform those services without triggering fiduciary status.

The platform provider exception is made available to individuals who market and make available

“securities or other property through a platform or similar mechanism”. However, the carve-out stops short of defining “other property” or a “similar mechanism” that might be an appropriate vehicle for the carve-out. While our members presume that annuity contracts are a “platform or similar mechanism” for purposes of the carve-out, for the avoidance of doubt, the Department should make this clear. Failure to clarify this point would place insurance companies, the sole manufacturers of variable annuity products, at a serious competitive disadvantage with regard to other financial institutions in the retirement plan market.

9 Field Assistance Bulletin 2004-03 (December 17, 2004)

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The Department requested comments on whether the scope of the platform provider exception should be limited to large plans similar to the scope of the seller’s exception. ACLI recommends that this exception apply to all plans, regardless of plan size, as currently provided in the Proposal. Adequate protection is provided to small plans due to the disclosures that are required of providers relying on this exception.

Furthermore, while the preamble suggests that the “platform” carve-out is available for a

platform that has preset investment options, this is not entirely evident from the text. Many platform providers offer participant-directed plans platforms with pre-selected investments, chosen without regard to the individualized needs of any particular plan or plan participant. Since there is no inherent conflict in the selection of these standardized investment platforms, they should be explicitly covered by the carve-out. Additionally, the carve-out should make clear that the platform can include products such as annuity contracts, including one or more deferred annuities and/or qualified longevity annuity contracts or “QLACs.”

ACLI further suggests that where a provider is merely offering a platform of predefined

investment options, the offering of such platforms or platform choices, like sales, should not be treated as advice. In such situations, the provider is merely offering a non-individualized platform of investment options from which an IRA owner can choose or monitor on a take it or leave it basis. For this reason, ACLI also supports extending the selection and monitoring exception in order to ensure that providers can, without assuming fiduciary liability, be responsive to an IRA owners request for investments meeting specific objective criteria specified by the IRA owner. The fact is that IRA owners can only benefit from information – and the ability to compare products and services – in a competitive marketplace. The Department should be encouraging and facilitating IRA owner access to this information, not, as under the Proposal, creating impediments to affording IRA owners options for enhancing their retirement savings.

ACLI members therefore recommend the following change to 2510.3-21(b)(3) and (4):

(3) Platform providers. The person merely markets and makes available to an Investor, without regard to the individualized needs of the Investor, investments through a platform or similar mechanism (which may include one or more annuity contracts) from which an Investor may select or monitor investment alternatives offered without regard to the individualized needs of the Investor, if the person discloses in writing to the Investor that the person is not undertaking to provide impartial investment advice or to give advice in a fiduciary capacity.

(4) Selection and monitoring assistance. In connection with the activities described in

(b)(3) of this section with respect to an employee benefit plan (as described in section 3(3) of the Act), the person –

Note that the language above assumes the Department will include the definition of “Investments” offered in Section I(G) above. If not, we ask that the phrase “insurance and annuity contracts” be included along with “securities, or other property.”

CC. The Proposal should include an exception for financial professional responses to proposal requests.

Under the Proposal, any communication that constitutes a “recommendation” falls within the scope of fiduciary investment advice. A ‘‘recommendation’’ is defined as a communication that, based on its content, context, and presentation, would reasonably be viewed as a suggestion that the advice recipient engage in or refrain from taking a particular course of action.10 While ACLI members

10 80 Fed. Reg. at 21960.

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appreciate the opportunity to offer further comment on the appropriateness of this definition, at base, it is currently drafted broadly enough to require several revisions to protect customary marketing practices. For instance, insurance companies routinely market themselves in response to requests for proposal which are, by definition, intended to encourage plan sponsors to engage in a “particular course of action”. In some cases, a response to a request for proposal may be binding if accepted. It appears that such responses would be considered “recommendations” – and by extension, investment advice – under the current definition. The plan size and asset restrictions currently made part of the seller’s exception do not rectify this inadvertent fiduciary problem. While there is an indication in the preamble that a response to a request for a proposal is not fiduciary advice, members seek a specific carve-out for requests for proposals.

Such carve-out could be worded as follows: “(X) Certain Proposal Responses and Related Activity. The person merely markets and makes available to an employee benefit plan (as described in section 3(3) of the Act), informational, marketing or similar materials at the request of a plan fiduciary, in order to encourage a plan fiduciary to engage the services of the adviser and/or an affiliate, irrespective of whether such materials or information are specifically individualized or directed to the plan or identify individual offered investment alternatives.”

DD. The education carve-out should be amended.

At the outset, we wish to commend the Department for recognizing the importance of retirement-related materials and programs and extending the principles of Interpretive Bulletin (IB) 96-1 to encompass such as part of the proposed rule. With 10,000 individuals reaching retirement age every day, the importance of helping individuals prepare for their retirement years is of critical importance and by clarifying that many activities designed to assist them do not constitute fiduciary investment advice is, in our view, a major step forward.

However, while taking a step forward in encouraging and facilitating the education of plan participants, the Department simultaneously took a major step backward in the area of investment education. For almost 20 years, the principles of IB 96-1 have served to afford participants access to meaningful investment-related educational materials and programs. The value and benefits of IB 96-1 were evident in the Department’s 2010 effort to modify the “fiduciary” definition. In that proposal, the Department could not have been clearer in its recognition of the importance of IB 96-1 by preserving IB 96-1 in its entirety and without change. In this Proposal, however, the Department takes the position that any reference of investments or options in conjunction with asset allocation models or other materials constitute “advice.” Not only a major change to well-established and relied upon guidelines that have proved valuable to millions of plan participants, but change that appears wholly premised on speculation (from a GAO report) that some participants “may” or “might” believe such references constitute advice – despite representations to the contrary or that some participants “may” or “might” not understand – despite explanations – that other investments might be available to them. With the proposed change, the Department has effectively shifted the obligation to populate asset allocation models to the plan participant, who for a wide variety of reasons is unlikely to do so, thereby significantly undermining what has been a valuable tool for millions of plan participants.

Participants and IRA owners need more, not less, education on annuities and other distributions

options. The education carve-out requirement to avoid specificity regarding the investment or distribution options available under a plan or IRA should be amended to preserve investor education activities that are critical to managing longevity risk and stemming retirement plan leakage. While the Department makes attempts to cover common distribution-related information “including information

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relating to annuitizations and other forms of lifetime income payment”11, the text of the carve-out falls short of achieving its stated goal.

Interpretive Bulletin (IB) 96-1, as restated and incorporated into a Department’s regulation,

acknowledges the important role of financial professionals in providing participants with educational materials without exposing them to potential fiduciary liability. The Proposal’s replacement of IB 96-1 with a carve-out renders it only marginally useful in this regard. Specifically, the Department’s narrowing of the definition of investment education with respect to specific investments makes it less effective, at best, and counterproductive, at worst. Investors will expect that the education received from financial professionals provides them with sufficient information to make informed investment decisions on their own; in fact, this will no longer be case.

The education carve out should extend to participant enrollment services where participants are

being enrolled into investments that have been designated by a plan fiduciary who is independent of the party providing the enrollment services, provided that no recommendations of specific investments are made in the course of such enrollment, and in the case of an investment product under the plan, such as an annuity contract, that is distributed in-kind from the plan, whether as an IRA (and thus effectively a rollover) or a non-transferable 401(g) annuity.

ACLI members therefore have specific suggestions for improving this carve-out. Each of these

changes fit squarely into the Department’s intent to carve-out “general information that helps an individual assess and understand income needs past retirement and associated risks (e.g. longevity and inflation risk) or explains general methods for the individual to manage those risks both within and outside the plan…”12

11. Distribution guidance should be expanded. For education to be meaningful, the

requirement to avoid specificity on distribution options available under the plan or IRA must be eliminated.

2. Education regarding features inherent in previously-purchased products should be

included in the carve-out. As the carve-out is currently written, it appears that a plan or an insurer cannot educate a participant or IRA investor about the features of a particular product that has already been purchased. For example, a customer service representative could not educate a policyholder about the decision to annuitize a previously-purchased contract, because that discussion would involve a communication regarding a “specific investment”. Similarly, a customer service representative could not read the terms of the annuity contract to the policy holder, answer routine questions regarding the annuity or restate contract terms or that of a prospectus.

3. Education as to which investment options fit into various asset classes should be

permitted. Participants and IRA owners need more information about investments, not less. Plan service providers should be permitted to assist the public in classifying investment options into the correct asset class without fear that they are inadvertently providing advice. More importantly, we need to be helpful to plan participants. General information about asset allocation that omits any information about available investment options will only confuse and frustrate participants.

4. “Anti-cashout” interventions should be included in the carve-out. Plan service providers

have a financial interest that supports the public interest in retaining participant assets in employer sponsored plans and IRAs. Investment education discouraging participants and IRA owners from “cashing out” their accounts, and investment education promoting IRA rollovers

11 80 Fed. Reg. at 21939. 12 Id. at 21944.

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(including rollovers into IRAs affiliated with the person providing the education) by participants, owners, and beneficiaries who are and as an alternative to a cash-out must be permitted. Taking an early lump-sum can have a devastating impact on retirement security. Firms should be encouraged to intervene to educate terminated participants about the consequences of taking their savings out to the tax-advantaged retirement system.

With these goals in mind, ACLI members offer the following revisions to the investment education carve-out:

“(6) Investment education. The person furnishes or makes available any of the following categories of investment-related information and materials described in paragraphs (b)(6)(i) through(iv) of this section to a plan, plan fiduciary, participant or beneficiary,…

(ii) General financial, investment and retirement information. Information and materials on financial, investment and retirement matters that do not address specific investment products, specific plan or IRA alternatives or distribution options available to the plan or IRA or to participants (other than a limited menu of options approved by the plan fiduciary or IRA owner), beneficiaries and IRA owners, or specific alternatives or services offered outside the plan or IRA, and inform the plan fiduciary, participant or beneficiary, or IRA owner about— (A) General financial and investment.. (iii) Asset allocation models….

(C) Such models do not include or identify any specific investment product or specific alternative available under the plan or IRATo the extent that an asset allocation model and related materials identify one or more investment alternatives or products available under the plan or IRA, the model is accompanied by a statement indicating that other investment alternatives having similar risk and return characteristics may be available under the plan or IRA and identifying where information on those investment alternatives may be obtained; and

…(v) Anti-cashout information. General methods and strategies that encourage participants to avoid in-service distributions when possible or suggest alternative post-distribution retirement plan savings vehicles designed to preserve retirement savings, including IRAs and similar products.”

IIII. PTE 84-24 must be revised to ensure sufficient exemptive relief for annuities and other

insurance contracts.

In order to allow both plans and IRAs to continue to purchase insurance and annuity contracts in the normal course of business, PTE 84-24 should be expanded to treat variable annuity purchases as covered transactions, and should allow for greater flexibility within the definition of “commission” to allow for traditional forms of adviser compensation. Furthermore, the exemption should clarify that compensation and other possible revenue or profit received by the insurer (rather than the adviser) is not subject to consideration, should provide for relief for existing transactions that rely on the exemption in its current form, and should clarify the Proposal’s definition of a “material conflict” that is subject to disclosure. We ask that the conditions imposed in Section IV with respect to insurance sales be no more cumbersome than those imposed on mutual fund sales. Finally, we suggest edits to clarify the application of PTE 84-24 to IRA transactions.

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As proposed, the Department’s amendments would revoke PTE 84-24 for advice provided to IRA owners with respect to transactions involving variable annuity contracts and other annuity contracts that constitute securities under federal securities law, as well as transactions involving the purchase of mutual fund shares. According to its Regulatory Impact Analysis, the Department believes that investment advice transactions involving variable annuity contracts and mutual fund shares are so similar to securities transactions that they should occur under the conditions of the BICE.13 However, the Department’s assessment in this regard ignores certain critical risk characteristics of variable annuity contracts that align these contracts more closely with insurance than securities. Thus the Department’s failure to include these contracts under the amended PTE is unwarranted and does not contribute to investor protections. An annuity contract does not convert from an insurance product to a securities product with the addition of a variable investment feature. Variable annuity contracts are not simply securities products; they are first insurance contracts. Contrary to the Department’s assertions in the preamble, they do not cease being the latter when they become the former. Instead, a variable annuity combines traditional insurance concepts with certain mutual fund principals to solve two increasingly important problems in retirement planning – rising life expectancy and the declining value of the dollar.14 Variable annuity contracts share many of the features of a fixed annuity contract, including fixed (general account) option with interest guarantees, mortality-based investment guarantees, retirement income guarantees, and the availability of additional life-contingent withdrawal options. These features are not available in a securities investment. Also unlike an investment in securities, both fixed and variable annuities provide for the liquidation of principal and income actuarially over a lifetime, with the insurance company assuming the risk of miscalculating mortality predictions in computing benefit payments.15 Whether an annuity contract is fixed or variable, the insurance company still bears the risk of the investor outliving capital. Given that, in practice, both fixed and variable annuity contracts require the company to bear longevity risk, these arrangements are far more similar to each other than to securities investments in any regard. Accordingly, the Department should reconsider the current distinction between these contracts under the amended PTE 84-24, and revise the PTE to cover the sale of all annuity contracts to IRAs.16 In addition, the definition of “insurance commissions” under the amended PTE is far to narrow, and should be broadened to include more traditional forms of compensation. Under the Proposal, insurance commissions would be newly defined as commissions paid by the insurance company or any affiliate of the insurance agent, insurance broker, or pension consultant for effecting the purchase or sale of an insurance or annuity contract.17 It would include renewal fees and trailers, but would prohibit advisers from receiving relief under the PTE for many other traditional revenue sources, such as revenue sharing and administrative and marketing fees, as well as payments from third parties. This revision would prohibit advisers from receiving these types of payments for sales to both plans and to IRA owners. This is a significant constriction of the protection afforded by the exemption as it has been interpreted for more than 30 years. While ACLI appreciates the Department’s attempt to carve certain forms of potentially conflicted revenue sources out of the exemption, defining commissions largely by

13 U.S. Department of Labor, “Fiduciary Investment Advice: Regulatory Impact Analysis,” April 14, 2015, p.4, available at http://www.dol.gov/ebsa/pdf/conflictsofinterestria.pdf. 14 Regulation of Variable Annuity Sales: The Aftermath of SEC v. VALIC, 1959 Wash U. Law. Q. 206(1959). Available at http://openscholarship.wustl.edu/cgi/viewcontent.cgi?article=3325&context=law_lawreview 15 See SEC v. VALIC, 79 S.Ct. 618,___ (1959). 16 Although ACLI members understand that relief for the sale of variable annuity contracts may still be available under the BICE exemption, due to the uncertainties regarding that exemption’s “reasonable compensation” requirement, the inability of the industry to access and compile information necessary for the required disclosures, and the general liability risks created for advisers and affiliates under the exemption, the BICE is not a viable option of the sale of these contracts. Please see section ___ of this comment letter for additional details. 17 80 Fed. Reg. 22010, 22020 (April 20, 2015).

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indicating what the term excludes, rather than what the term includes, will create an uncertain compliance environment for insurers. In its current form, the amended definition forces advisers to postulate as to the Department’s expectations regarding other types of permissible commission sales under an exemption relied upon heavily by the industry. Insurance companies will have no guidance as to whether other basic revenue sources, such as sales incentives that allow advisers to earn credits toward retirement and health benefits and guaranteed income overrides to third parties paid for overseeing adviser activity, remain permissible. For instance, the revised definition would prohibit payments from third parties and payments that result from the underlying investments that are held pursuant to the insurance contract. This prohibition, as it is currently worded, could restrict the sale of annuities entirely, since both variable and fixed annuities generally include an account that has the potential to generate revenue to the insurer. An inclusive definition of “insurance commission” would be a helpful step toward alleviating these concerns and correcting the practical issues raised by the amended PTE. However, given the complexity of the insurance market and the various methods insurers use to help facilitate distribution, an inclusive definition of commissions should be flexible enough to allow for the various interpretation and terms used to identify permissible compensation sources. In addition, we ask the Department to confirm that when necessary, Section I(a)(4) of PTE 84-24 covers an insurance company’s receipt of the revenue and any profit that is the necessary result of the sale. This is critical for the sales of proprietary annuities by an insurance company, including its employees, and sales by advisers associated with affiliated selling firms. If the insurance company’s revenues and profits are not permitted, this exemption will have no utility for proprietary product sales, which we do not believe is the Department’s intent. Furthermore, the Department offers no reason why an exemption that allows for additional traditional forms of compensation, such as revenue sharing, cannot be fashioned to protect investors’ rights. A robust disclosure structure that fully and accurately describes any potential conflict associated with variable sources of revenue would reduce disruption in the market and provide for greater choice for investors. To this end, ACLI members assert that the categories of commissions that would align with Congressional directives under ERISA section 408(a) are far broader than simply renewal fees and trailers. We note that these other forms of commissions, including revenue sharing and similar forms of compensation, are already subject to ERISA’s reasonable compensation standards through the disclosure regime currently in place pursuant to section 408(b)(2). Specifically, those disclosures require service providers to disclose any compensation paid from the provider to third parties or affiliates acting as subcontractors if paid on a transaction basis. Such disclosures are also required to the extent such compensation is charged directly against the covered plan’s investment and reflected in the net asset value of the investment. Given that this compliance structure already drives the types and amount of commissions that can reasonably be paid to financial professionals, there is little to no additional benefit to be gained by using a highly restrictive definition of “insurance commissions” in the proposed amendment to PTE 84-24. The insurance industry has taken great pains to deliver quality products, compensate financial professionals, and protect the best interests of retirement investors in a manner that complies with ERISA, securities law, FINRA guidance and applicable state law. The ability to protect that revenue from ERISA prohibited transaction laws does not rest with restricting the types of commissions advisers receive. It rests instead with the Department’s success in crafting clear, definitive compliance parameters for investment advice fiduciaries that align with the interests of investors – including their interest in the availability of a wide range of annuities and other investment products. With respect to proprietary sales, the amended PTE must clarify that revenues to the insurer for group annuity recommendations will not be restricted by the revised definition of “insurance commissions.” Often, insurance companies will receive various sources of revenue when group annuity

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products are offered to plan sponsors by an affiliated or unaffiliated financial professional, including revenue payments from third parties. These payments present no potential conflict, because their receipt by the company does not influence the adviser’s recommendations. Because these revenues are not included in the definition of “commissions”, it not clear that such revenue would receive the protection of the PTE, even if the revenue does not vary depending on the product chosen by the plan fiduciary. We therefore strongly encourage the Department to add clarifying language to provide for this protection in the final exemption. The revised exemption also provides no protection for arrangements that currently rely on PTE 84-24. Variable commission sales and sales involving 12b-1 commissions, for instance, would be stripped of the exemption’s protection, without immediate recourse for advisers and investors who have relied on the existing interpretation in good faith. If the Department truly seeks to protect customary retirement savings arrangements that have been successfully executed over the past 30 years, the final exemption should provide grandfather protection for existing contracts that currently fall outside of the bounds of the amended PTE. Regarding the Impartial Conduct Standards, while we agree that disclosure of material conflicts of interest is not only optimal, but absolutely crucial to protecting investor interests, the proposed amendments to PTE 84-24 do not sufficiently define the term “material conflict”. Again, further clarification regarding this standard will be critical if the failure to disclose a material conflict of interest will be deemed to be a misleading statement, and will violate a key exemption requirement. To the extent that PTE 84-24 compliance is premised on such an opaque standard, the insurance industry will find it necessary to discontinue relationships that have traditionally relied on the protection of exemption. As a result, investor access to professional advice from highly-regarded financial professionals will be reduced, particularly among IRA owners. There is a risk that an inadvertent failure to disclose something minor, for example the fiduciary’s receipt of a minor benefit such as a routine lunch or dinner paid for by the insurance company issuing the insurance or annuity contract, would result in the transaction and all attendant compensation being prohibited and subject to disgorgement and excise taxes. This result would be harmful and wholly disproportionate to any possible harm caused by the inadvertent disclosure failure. With respect to transactions involving insurance and annuity contracts, Section IV(b)(2) of the proposed PTE 84-24 requires that the “independent fiduciary acknowledge in writing the receipt of the required disclosures . For transactions involving mutual funds, Section IV(c)(2) requires the independent fiduciary to approve the transaction following the receipt of the required disclosures. ACLI asks that these be aligned to require the approval of the transaction without the need for a “written acknowledgement.” While the amendments to PTE 84-24 are characterized as covering transactions involving IRAs, the covered transactions and conditions for relief do not describe IRAs (e.g., the use of the phrase “with plan assets”). This language should be revised to clearly include the assets of an IRA. Likewise, the conditions in Section IV require the engagement of an independent fiduciary. This person should also include an IRA owner or a fiduciary engaged by the IRA owner to act on their behalf. While ACLI members appreciate the certainty that a definition brings to the existing exemption, significant amendments will be necessary in order to make the exemption a viable option for the insurance industry going forward. Accordingly, ACLI recommends the following changes to the text of the exemption in its proposed form:

Revise the phrase “with plan assets” to read “with plan or IRA assets” as it appears in Section I(a)(1)-(4).

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Revise each instance the phrase “independent fiduciary” appears in Section IV to read “independent fiduciary or IRA owner.”

Revise Section I(a)(4) as follows:

(4) The purchase, with plan assets, of an insurance or annuity contract from an insurance company and the resulting receipt of compensation by the insurance company in connection with the purchase.

Strike Section I(b). Revise Section VI(b) as follows:

(b) The insurance agent or broker, pension consultant, insurance company or investment company Principal Underwriter that is a fiduciary acts in the “Best Interest” of the plan or IRA is when the fiduciary acts with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person would exercise based on the investment objectives, risk tolerance, financial circumstances and needs of the plan or IRA, without regard to by placing the interests of the Retirement Investor before the financial or other interests of the fiduciary, any affiliate or other party. Revise Section VI(f) as follows: (f) The term “Insurance Commission” means (1) a sales commission paid by the insurance company or an Affiliate to the insurance agent or broker or pension consultant for the service of effecting the purchase or sale of an insurance or annuity contract, including renewal fees, trailers, gross dealer concessions and overrides, and but not(2)revenue sharing payments, administrative fees, marketing payments, and other payments from parties other than the insurance company or its Affiliates.

Revise Section VI(h) as follows:

(h) A “Material Conflict of Interest” exists when a person has a material financial interest that could affect the exercise of its best judgment as a fiduciary in rendering advice to a plan or IRA.

IV. The Best Interest Contract Exemption (BICE) must be revised and re-proposed since,

absent substantial changes, it has no utility for the insured retirement industry.

In theory, the BICE would permit investment advice fiduciaries to receive otherwise prohibited compensation in connection with transactions involving IRA owners, plan participants and beneficiaries with direct investment authority, and plan sponsors of certain non-participant directed plans. These individuals are referred to collectively in the exemption as “Retirement Investors.” To receive the protection of the exemption, fiduciaries would need to:

Act in the “Best Interest” of the Retirement Investor, and Receive no more than “reasonable compensation”, and Not make any misleading statements, and Admit fiduciary status under ERISA, and Prior to offering any recommendation, along with a “Financial Institution,” enter into a contract with the Retirement Investor that:

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o Includes warranties that state that the fiduciary and “Financial Institution” –

Will comply with all applicable federal and state securities laws, and Has written policies and procedures to mitigate conflicts of interest, and Has identified any material conflicts and adopted measures to make sure that they do not violate the BICE “impartial conduct standards”, and Does not use incentives, quotas or other personnel actions, bonuses, contests, special awards, differential compensation or other actions that would encourage an adviser to make recommendations that are not in the Best Interest of the investor, and Does not contain any exculpatory provisions disclaiming or otherwise limiting the liability of the adviser or financial institution for a violation of the contract’s terms, or waives their right to bring a class action regarding the dispute.

In addition, the fiduciary must:

Detail material conflicts of interest; Inform the Retirement Investor of his or her right to obtain information about fees; Disclose whether the fiduciary offers proprietary products or receives 3rd party payments with respect to the purchase, sale, or holding of any asset, and provides the website where that information can be located (the “initial disclosure”); Provide point of sale disclosures explaining the total projected cost of the assets available for investment (the “point of sale disclosure”); Provide an annual disclosure of each asset purchased and sold in the past year, and the compensation received by the adviser (the “annual disclosure”); Maintain a website that shows the cost and the direct and indirect compensation paid to the adviser, the financial institution, and each affiliate for each assets in the plan (the “website disclosure”); Make a range of investment options available that is broad enough to enable the adviser to make recommendations from all the asset classes “reasonably necessary to serve the investor’s Best Interest, or, if they do not offer such range, make a written finding that limits on the assets offered do not prevent the adviser from providing advice that is in the Best Interest of the Retirement Investor; and Provide, upon request, detailed and sensitive information related to the activity within a customer’s account, personal information related to advisers which the Department can post publicly and detailed information related to investments offered under the exemption.

The BICE does not meet the administrative exemption requirements under ERISA §408(a), and therefore should re-proposed after further consideration. We also ask that a final rule regarding the definition of fiduciary not be effective until a workable exemption is also made final and effective. ERISA §408(a) grants the Department authority to grant administrative exemptions from the prohibited transaction provisions of ERISA and the Code for a class of transactions or for individual transactions. However, in order to grant an administrative exemption, the Department must make a determination that the exemption is (1) administratively feasible; (2) in the interest of the plan and its participants and beneficiaries; and (3) protective of the rights of plan participants and beneficiaries. The BICE does not meet the requirements for an administrative exemption under §408(a). As detailed herein, the BICE is far from administratively feasible -- it requires entities that are not functional

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ERISA fiduciaries to adopt fiduciary status; it is strikingly opaque regarding basic compliance concepts such as 'reasonable compensation'; it is incompatible with standard business practices in the financial services industry; it may inadvertently subject agents and brokers to the Investment Advisers Act of 1940; and its disclosure requirements potentially conflict with SEC and FINRA compliance rules. While a broad exemption is clearly necessary under the Proposal, BICE also does not serve the interests of plans, participants, and IRA owners, because its will eliminate financial professionals' ability to provide advice to certain small plans and participants eligible for a distribution. Finally, the BICE is not protective of the rights of plan participants and beneficiaries, because it will reduce access to the types of helpful investment education that participants in self-directed plans and IRAs have come to expect, and provides no substantive transition relief to allow retirement investors to maintain their existing arrangements under the current terms if they so choose. Given that the Department has issued more than 120 separate requests for public comment and assistance with regard to the BICE alone, it stands to reason that the exemption deserves further agency attention consistent with the administrative exemption principles in ERISA §408(a). ACLI therefore urges the Department to withdraw the BICE, and to consider re-proposing the exemption following a more robust period of public comment in which all stakeholders have the opportunity to address the Department's questions and concerns.

In the preamble to the BICE, the Department inquired as to the distribution methods and channels applicable to annuity products that are not securities. As you consider the following comments, it is important to note that annuities are offered through a broad spectrum of distribution channels. These include agents (via insurance agencies or by insurer’s own employees), affiliated or independent broker-dealers, wirehouses, financial planners, and financial institutions such as banks. Agents appointed by a company offering annuities may be “captive,” offering only that company’s proprietary products. Some annuity companies may allow their agents to offer other companies’ products in limited circumstances, such as when the customer is looking for a type of annuity the carrier does not offer. Some insurers and external distribution partners such as banks, wirehouses, and independent broker-dealers offer products including annuity products in addition to an insurer’s proprietary products. Some annuity carriers contract with independent “marketing organizations” that act as an intermediary between independent insurance agents and the annuity carrier. These marketing organizations may perform services such as agent recruiting, contracting, licensing, continuing education, and sales support. Individuals that offer an insurer’s fixed annuities and other non-security annuity contracts must be appropriately licensed and appointed by the company. For an annuity that is a security (i.e. a variable annuity), the individual also must have a security license and also be properly registered with FINRA and applicable state security departments. Annuities that are securities may be offered through affiliated or non-affiliated broker-dealers. As for the types of annuities that are offered and to whom they are offered, this varies. Some insurance companies only utilize agents whereas others utilize the full spectrum of agent and third party distribution partners. Sales of proprietary products may be more concentrated within an insurer’s career agent salesforce. Broker Dealers may sell annuity-based IRAs and nonqualified annuities to individuals, while annuity sales to qualified plans may be more concentrated in a smaller number of registered representatives. Bank channels may sell more fixed than variable annuity products while wirehouses tend to offer more variable products such as variable annuities with living benefits. However, there does not appear to be a consistent trend in the prevalence of the type of annuities that are offered through different distribution methods across insurers.

In our review of the BICE, by any measure, it is the most prescriptive exemption ever issued by

the Department. We have a number of concerns regarding the BICE as proposed. Set forth below is an

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explanation of these concerns, as well as recommendations for the Department’s consideration as to how the BICE could be modified. The BICE imposes fiduciary status on insurers even when the insurer is not a fiduciary under the proposed definition. The proposed definition requires that a person both (1) provide a recommendation regarding an investment or financial professional (or offer and appraisal), directly to a plan or IRA owner and (2) acknowledge fiduciary status or provide advice pursuant to an arrangement or understanding. Under the BICE, a “Financial Institution” is defined as an entity that retains an Adviser who is an independent contractor, agent or registered representative. Financial Institutions do not provide advice directly to plans or IRA owners; as such, they would not be fiduciaries under the proposed regulatory definition. However, although not fiduciaries, Financial Institutions must nevertheless agree to be fiduciaries in order for the Adviser to take advantage of the exemptive relief of the BICE. As the BICE requires a contract be signed before a recommendation could be made, Advisers who conduct business with a variety of Financial Institutions and/or are retained by more than one Financial Institution will need to have the investor sign agreements with each and every one before they enter into a discussion. Generally, if a fiduciary does not comply with the every requirement of the BICE, the fiduciary risks engaging in a prohibited transaction. However, certain requirements of the exemption are so ambiguous that it would be difficult for any fiduciary to confirm that she is in compliance with BICE. The Impartial Conduct Standard requires that the adviser and financial institution agree contractually that they will not recommend an investment if the total amount of compensation anticipated to be received in connection with the recommended transaction exceeds reasonable compensation in relation to the total services provided. ACLI is concerned that the use and meaning of “reasonable compensation,” which is not explained in the exemption, is intended to have some meaning other than as applied under the statutory exemption found at ERISA §408(b)(2) and the regulations promulgated thereunder. ACLI also questions the propriety of measuring the sum total of all compensation received in connection with the sale of a proprietary annuity product against the reasonable costs of services provided to the advice recipient. Insurance products include charges that are assessed not merely for the provision of services, but also for the provision of the guarantees and other financial benefits set forth in the insurance contract. Prohibited Transaction Exemption 84-24, which also contains a reasonable compensation condition, takes this incremental additional cost into account by including not just the costs of fees related to the provision of services but also the fees and other considerations received in connection with the purchase of the insurance or annuity contract for purposes of determining the reasonableness of total cost. ACLI urges the Department to extend this approach to the BICE. The BICE requires advisers and financial services companies to represent that the investment will, in essence, meet the ERISA prudent man standard. As noted in an April 2005 article in the Journal of Pension Benefits, “The prudent man rule is only 42 words long, but it is the parent of scores of litigated cases and millions of words of analysis. Despite this volume of information the rule still creates confusion and discomfort. That is doubly true in the context of participant directed plans.” The Second Circuit Court of Appeals called the ERISA prudence standard “one of the highest duties known in the law”.18 To add additional untested and undefined standards to the prudence obligation leaves the overall requirements for the BICE so uncertain as to expose fiduciaries seeking to utilize the exemption to potentially enormous financial risks, the scope of which cannot reliably be estimated in light of the legal uncertainties introduced by the Department’s new language. These uncertainties are so great that many financial institutions may conclude that reliance on the BICE would itself be imprudent to the company’s other constituencies, including its other policyholders, its employees and shareholders. ACLI requests that, at a minimum, the changes recommended here be adopted and that the Department consider providing a detailed definition of each standard.

18 See Donovan v. Bierwirth, 680 F.2nd 263, 272 n.8 (2nd Cir. 1982).

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AA. The impartial conduct standards that form the foundation of the BICE are unacceptably ambiguous.

1. The BICE is not clear as to which forms of variable compensation are permissible.

The BICE impartial conduct standards include two separate requirements that create unacceptable ambiguity as to whether the customary compensation practices would be permitted going forward. First, the BICE requires financial institutions to warrant that they do not pay their advisers differential compensation that would tend to incent the adviser to make recommendations that are not in the best interest in of Retirement Investors. Second, financial institutions are required to represent that the compensation received by the financial institution, the adviser, affiliates and related parties is reasonable for the services provided to the retirement investor. Furthermore, if the financial institution places limits on the investments it offers, then under Section IV of the exemption, the Department sets forth an even higher standard that requires the financial institution to justify each payment stream with separate and distinct services. These requirements are over and above the basic requirement that the adviser only make recommendations that are in the best interest of investors. These additional requirements under the BICE impartial conduct standards should be eliminated, sufficiently contextualized, or the extent of the obligations should be clearly defined. The Department states in the preamble to the exemption that the BICE is designed to allow continued receipt of commissions, yet the text of the rule does not create a clear, operational standard that accounts for the industry’s diverse business models. BICE ambiguity as to permissible compensation structures results in the courts or the Department, rather than the Retirement Investor or the market, deciding the manner in which a retirement investor can pay for services. Allowing a court or a regulator to decide after the fact whether differential compensation in the form of commissions satisfies this standard is plainly unworkable. 22. The prohibition on differential compensation should be eliminated.

The Department describes the BICE exemption as a business model-neutral means by which a fiduciary may receive differential compensation without triggering a prohibited transaction. By the Department’s determination, the BICE “accommodates a wide range of current business practices while minimizing the impact of Conflicts of Interest…”19 However, in practice, the BICE is primarily suited for a business model that does not actually exist among insurance-based financial services institutions – one that does not pay advisers differential compensation for the sale of products. According to the BICE, “[n]either the Financial Institution nor (to the best of its knowledge) any Affiliate or Related Entity uses quotas, appraisals, performance or personnel actions, bonuses, contests, special awards, differential compensation or other actions or incentives to the extent they would tend to encourage individual Advisers to make recommendations that are not in the Best Interest of the Retirement Investor. Notwithstanding the foregoing, the contractual warranty set forth in this Section II(d)(4) does not prevent the Financial Institution or its Affiliates and Related Entities from providing Advisers with differential compensation based on investments by Plans, participant or beneficiary accounts, or IRAs, to the extent such compensation would not encourage advice that runs counter to the Best Interest of the Retirement Investor (e.g., differential compensation based on such neutral factors as the difference in time and analysis necessary to provide prudent advice with respect to different types of investments would be permissible).” (emphasis added).20 Given this highly subjective, ambiguous text, this condition creates considerable uncertainty as to how the Department would interpret—after the fact—whether Financial Institutions used differential compensation, or took other actions, that “tended” to encourage “individual Advisers” to make recommendations that are not in the Best Interest of the Retirement Investor. This can be interpreted to require that each firm prove that the differences in the compensation received by the adviser and firm (e.g., commission rates, loads, third party payments, breakpoints, payout grids, etc.) amongst and within different products (e.g., stocks, bonds, annuities, mutual funds, etc.) are justified based on neutral factors (and are therefore in the client’s best interests) rather than set by the market.

19 80 FR 21947 20 80 Fed. Reg. at 21984.

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The Department states in the Preamble that the BICE is designed to allow continued receipt

of commissions, yet the text of the rule does not create a clear, operational standard that accounts for the industry’s broker-dealer models. In fact, the financial services industry is vast, the products are varied, and the distribution channels and compensation structures are far more complex than anticipated by the Department. This is evident, for example, in the “neutral” differential compensation models identified as permissible, such as models that compensate advisers based on “time and analysis” necessary to provide advice with respect to different types of investments, use a fee-offset model, or rely strictly on an “assets invested” calculation. These models are not currently employed by most insurers, and even if they were more clearly defined, could not be instituted without significant changes to the very core of their compensation models. The result is that middle class Americans could lose access to commission-based products, including annuities and mutual funds, the very products they should be invested in to fund their retirement. Currently, 98% of investor accounts with $25,000 or less in their IRAs are in brokerage relationships.21 This makes commission based accounts the most effective way for middle class investors to save for retirement and secure guaranteed lifetime income so that they do not outlive their retirement assets.

In the preamble to the proposed BICE, there are a number of examples of how a firm may

mitigate conflicts. We ask that, when issuing a final BICE, the following example be included to illustrate how a firm may reasonably mitigate conflicts when customary compensation differs based on products and services. As proposed, the BICE would not provide this firm any certainty as to whether compensation paid is permitted or prohibited.

Example: Balancing of asset-based and commission compensation. The Financial Institution permits the Adviser to receive either a commission or asset-based compensation, but not both, for any single affiliated or unaffiliated investment product, provided however that only a commission may be paid with respect to an investment product with no account value, such as an immediate annuity or a qualifying longevity annuity contract (QLAC), unless an actuarial present value will be provided periodically by the contract issuer. The Financial Institution does not offer any investment product or alternative that pays a commission which materially exceeds the average commission rates for similar products (as determined through periodic market surveys or analysis), or for which the aggregate of product fees and account advisory fees would exceed the cost to the client of a comparable commissioned product available to the Financial Institution and the Adviser. The Financial Institution also encourages, but does not require, the use of financial plans applying generally recognized principles of retirement income planning, to determine an appropriate allocation to annuity contract income guarantees. Under the Proposal, however, clients will likely be required to enter into a managed account (an

account favored by the BICE) and such clients may find that managed accounts are the only accounts available in order to receive any guidance:

Advisory-fee based accounts typically require minimum investment of amounts between $50,000 to $250,000 (depending upon the services and whether it is a retirement account). Thus, commission-based accounts are often the only way in which investors with less to invest can obtain any form of guidance. Managed programs, which charge ongoing fees based upon assets under management, can be more expensive and are generally not a good choice for buy and hold investors, such as those investors who seek lifetime income guarantees.

21 Oliver Wyman report: Assessment of the impact of the Department of Labor’s proposed “fiduciary” definition rule on IRA consumers, April 12, 2011, available at https://www.dol.gov/ebsa/pdf/WymanStudy041211.pdf.

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Annuities are generally sold on a commission basis and not in a managed account, decreasing a retiree’s opportunity for guaranteed retirement income. FINRA and the SEC do not consider managed accounts suitable for investors who do not trade very often. The SEC encourages such investors to maintain brokerage accounts rather than paying an ongoing fee in an advisory account. The cost of losing access to retirement security products and services is not something American

savers and retirees can afford. An Oliver Wyman study estimated that direct costs to savers who use brokers and are forced into managed accounts in order to continue to receive access to retirement products and services would increase from anywhere from 75 percent to 195 percent. In response to various stakeholders raising this concern, the Department has consistently assured Congress, consumers and financial professionals that their Proposal would not ban commission based products and services. The Department has essentially banned commission-based products and accounts by adding conditions that simply do not work for brokerage accounts and annuities.

The current language regarding compensation models that “tend to” encourage conflicts should be eliminated. The standard is far too broad. Rather than forming the basis of an objectively determinable standard, this particular language assures subjectivity and confusion among plaintiffs, defendants and the courts themselves. We would suggest that the warranty section related to policies and procedures should be eliminated entirely. Firms will have sufficient incentive to adopt policies and procedures given the impartial conduct standard requirements of the contract. Adding additional requirements that create confusion and ambiguity related to commission-based sales is not helpful or necessary. The Impartial Conduct Standards and the other affirmations made under the Section II(d) Warranties provide extensive and sufficient consumer protections. These warranties include the disclosure of Material Conflicts of Interest. Thus, Section II(d)(4) is not only redundant, but unnecessarily creates uncertainty as to the utility of the BICE. This further supports the need to re-propose the exemption in a workable form. ACLI recommends Section II(d)(4) be eliminated.

33. The Proposal should utilize one definition of reasonable “and customary” compensation.

The Department uses three different formulations of the concept of “reasonable compensation” within the BICE creating unnecessary and harmful confusion. With respect to the “reasonable compensation” requirement under the BICE’s impartial conduct standard as well as the supposedly heightened standard found in Section IV of the BICE, we are concerned that the wording used by the Department seems to require fiduciaries to justify each third-party payment they receive in relation to specific services provided to a particular IRA owner or 401(k) participant. Consistent with revenue sharing practices used for many years in the 401(k) industry, it is common for providers, like broker-dealers, who offer IRAs to use third-party payments like revenue sharing and sub-transfer-agent fees to help pay for the platform and keep down direct costs to the clients. Due to economies of scale, these negotiations with the product providers are done at a book of business level, rather than at an individual investor level, and are based on the relevant negotiating powers of the parties. Third-party payments, like revenue sharing, are not typically paid to advisers so generally do not create a conflict under the differential compensation warranty mentioned above. Furthermore, it would be untenable to match up any particular payment to any particular investor. In fact, some investors may pay slightly more due to the funds they select while others may pay slightly less even though the services are basically the same. Higher net-worth clients with larger account balances subsidize those with more modest lower account balances. This subsidization permits investors with smaller balances to save for retirement at lower costs and is inherent in many investment products in the market place, including mutual funds, which by their very nature and purpose mutualize the costs of investing. We would appreciate the Department clarifying that such variances are reasonable by deleting the “in relation to the total services they provide to the

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Retirement Investor” language in Section II(c)(2) and by deleting the supposedly heightened “reasonable compensation” provision in Section IV (we explain why the entire Section IV is misguided and should be deleted in its entirety later in this letter).

Our members know of no repository, public or private, of information regarding market rates for various types of firms, advisers, investments, or services. Without a measurable standard, not only is the reasonable compensation standard meaningless, it is impossible to meet this standard with any degree of accuracy. Furthermore, the Department offers no proposed definition of reasonable compensation that would specifically offer us the opportunity to offer meaningful comment. Although the Department makes reference to reasonable compensation “under the circumstances” in the preamble, no such context is made part of the proposed exemption. Any such references presumably are to the standard generally applicable to fiduciaries when they are engaging a third party to provide a product or service to the plan. Such a fiduciary is generally expected to have a reasonable process for determining the reasonability of the compensation, whether based on multiple bids or otherwise. Under the Department’s Proposal, it is that same fiduciary – or plan participant or IRA owner – who will instead be challenging the reasonability of the compensation, and absent further clarification from the Department the fiduciary adviser will have no clear standard to assert in its defense, whatever the level of the compensation may be. The Department should confirm that a reasonable process for the investment advice fiduciary would be sufficient to establish that the fiduciary’s compensation is reasonable and customary.

The concept of reasonable compensation is already inherent in ERISA, and is therefore redundant as part of the exemption as to retirement plans. ERISA section 408(b)(2) provides an exception for “reasonable arrangements” for necessary services for which no more than “reasonable compensation” is paid. While this standard does not apply to IRA plans, the Department would eliminate significant administrative duplicity by simply requiring a warranty with regard to reasonable and customary compensation – and an identifiable standard therefore – as part of the BICE as it applies to IRAs.

With these points in mind, ACLI members recommend amending Section II(c)(2) as follows:

“…., if the total amount of compensation anticipated to be received by the Adviser, and Financial Institution and, Affiliates and Related Entities in connection with the purchase, sale or holding of the Asset by the Plan, participant or beneficiary account or IRA, will exceed that which is reasonable and customary for the products and services provided reasonable compensation in relation to the total services they provide to the Retirement Investor; and comply with the following:”

44. The Structure of the BICE Makes Compliance Uncertain and Therefore, Unworkable

The principles-based nature of the BICE creates considerable exposure for advisers seeking the protection of the exemption, rendering it unusable from a compliance standpoint. In order to meet the requirements of the BICE and avoid a prohibited transaction, fiduciaries would not only be required to contractually obligate themselves to act in the client’s best interest but would also have to comply with the best interest standard to avoid a prohibited transaction. This formulation makes it impossible for financial institutions to have confidence that they have ever met the conditions of the BICE and is unnecessary to protect retirement investors. By requiring a contractual obligation, the Retirement Investor will have a legally enforceable cause of action against a financial institution for breach of contract if the client is harmed by recommendations that were not in his or her best interest. This legal cause of action is what the Department claimed was necessary to protect Retirement Investors. However, the Department also makes compliance with the best interest standard a condition of the exemption itself. Because such compliance is purely subjective, financial

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institutions will never be certain whether the conditions have been met and that no excise taxes are owed. Furthermore, the penalty for breach of contract will be to compensate the Retirement Investor for any harm suffered. The penalty for a prohibited transaction is an excise tax that is due regardless of whether any harm occurred.

In addition, financial institutions are also required to warrant, or guarantee, certain

conditions that are likely to be determined only in retrospect, such as:

That they are in continuous compliance with all state and federal securities laws, That each “material” conflict has been identified and disclosed; and, That they have personnel policies appropriately align with the Best Interest standard.

If a court determines that a fiduciary breached any of these warranties, or even if a court determined that a fiduciary’s fees were “unreasonable”, the fiduciary could be subject to undeterminable monetary damages based on a new state-law contract right of action. Allowing courts to be determine ERISA fiduciary compliance in hindsight without any clear mitigation strategy is simply not an acceptable business model for any responsible ERISA fiduciary, and many advisers will strongly consider exiting the retirement market due to inability to properly assess the risks.

Even in the absence of litigation, it is not clear that an adviser would be able to determine

whether an excise tax is due. A fiduciary that takes reasonable measures to maintain reasonable fees may find that as market conditions shift, those fees may be deemed ‘unreasonable’ under the very same standard. As the law develops in this area, a fiduciary may find that her firms’ compensation practices may be deemed to inappropriately promote propriety products over non-proprietary products. It is unclear, under the BICE, whether this knowledge alone triggers an excise tax under Code section 4975, and an attendant duty to self-report.

The language in the preamble to the BICE only adds to the ambiguity associated with

compliance. The preamble states that the “effect of noncompliance with any condition [of the exemption] depends on whether the condition applies to a single transaction or multiple transactions. The compensation associated with the prohibited transaction, or segment of the prohibited transaction, would not receive the relief.”22 This language is wholly unhelpful in assessing compliance risk associated with the BICE.

As currently constructed, no fiduciary could ever be certain that the BICE applied to its advice, exposing fiduciaries to a punitive excise tax scheme even for an inadvertent failure to comply. There would be no need for the Retirement Investor to demonstrate that harm has occurred, or even to demonstrate that he or she did not benefit from the recommendation. The BICE exemption should be overhauled to include bright-line rules for compliance and safe harbors that would allow a fiduciary, at the first instance, and a court, at the second, to determine when compliance is compromised. The impartial conduct standards that are not objectively measurable, such as whether a fiduciary has acted in the Best Interest of a customer, whether his or her compensation is reasonable, and whether a potential conflict is ‘material’ enough to trigger a disclosure requirement, should be made contractual representations, rather than conditions of the exemption.

22 80 FR 21976

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At minimum, section II(c) of the BICE should be amended as follows:

“Impartial Conduct Standards. The Adviser and the Financial Institution affirmatively agree to, and comply with, the following:”

55. The definition of Financial Institution and the imposition of fiduciary status through the BICE, not the definition of fiduciary, are unacceptable.

Fiduciary status should be addressed by the definition promulgated under ERISA §3(21)(A)(ii) and not imposed as a condition of exemptive relief. Financial Institutions that do not provide advice directly to plans or IRA owners would not be fiduciaries under the proposed regulatory definition. Under the BICE definition, in addition to an employer of an Adviser, a Financial Institution is to include any entity that “otherwise retains such individual as an independent contractor, agent or registered representative…” Thus, firms that have granted the Adviser permission to sell products and who otherwise are not treated as fiduciaries under the ERISA or the proposed regulatory definition nevertheless must agree to fiduciary status under the BICE in order to sell products and allow the Adviser to obtain the relief provided by the exemption. This is the case despite the fact that they do not function as ERISA fiduciaries, do not directly control the actions of the Adviser, and have no ability to influence the Adviser’s recommendations. This is not acceptable. Furthermore, the application of this particular provision of the BICE on Advisers that have numerous relationships with a number of entities including multiple insurance companies is not administratively feasible. An Adviser may serve as a licensed investment adviser for a registered investment advisory firm, a registered representative of a broker dealer, and a licensed insurance agent of an insurance agency. She may be an employee of one of these firms. She may have a variety of products to offer a customer from a multitude of product manufacturers. Under the BICE, the Adviser and every potential “Financial Institution” that may be a part of her discussion with the investor must enter into a contract with an investor prior to a recommendation and, as noted, the acknowledge status as a fiduciary. ACLI recommends that the BICE definition of “Financial Institution” be limited to only those entities that are fiduciaries under the definition of fiduciary. Entities that, under the definition of a fiduciary, would not be treated as a fiduciary under the definition of fiduciary should be required to accept such status under the BICE. Section VIII(e) of BICE should be revised to read as follows:

“(e) "Financial Institution" means an entity that is an "affiliate" (as defined in ERISA §2510.3-21(f)(7)) of the Adviser who, together with the Adviser, functions as a fiduciary under ERISA §2510.3-21 for purposes of the covered transaction.”

B. Even if the compliance ambiguities were clarified, the technical requirements under the BICE

render the exemption unworkable in the absence of significant changes. Even aside from the compliance risks associated with the BICE, our members believe that

they would not be able to preserve their current business models and rely on the BICE for a number of very fundamental reasons. Each of these reasons is itemized and reviewed in detail below.

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11. The Best Interest contract standard as drafted is unduly restrictive and impractical.

Section VIII(d) of the BICE states investment advice is in the ‘‘Best Interest’’ of the Retirement Investor when the Adviser and Financial Institution providing the advice act with the care, skill, prudence, and diligence under the circumstances then prevailing… without regard to the financial or other interests of the Adviser, Financial Institution or any Affiliate, Related Entity, or other party.23

This provision could easily be interpreted to imply that if an adviser has any financial interest

in a retirement plan or IRA the transaction at all, he or she has violated the Best Interest standard. This includes having an interest in receiving any commission in any amount. This standard is more restrictive than even the standard for fiduciaries under ERISA, which the Department has recognized allows for certain incidental benefits due to the fiduciary’s relationship to the plan.24 While it is unlikely that the Department expects that advisers as fiduciaries could interact with any customer entirely without regard to whether or not they will be compensated, the definition should be amended to make this fact clear.

The definition of Best Interest in Section VIII(d) should therefore be amended as follows:

“…and needs of the Retirement Investor, without regard toplacing the interests of the Retirement Investor before the financial or other interest of the Adviser, Financial Institution or any Affiliate, Related Entity, or other party);”25

Corresponding revisions should be made to the following sections:

Section II(c)(1):

“…and needs of the Retirement Investor, without regard toplacing the interests of the Retirement Investor before the financial interests of the Adviser, Financial Institution or any Affiliate;”

Section IV(b)(4):

“…and needs of the Retirement Investor, without regard toplacing the interests of the Retirement Investor before the financial or other interests of the Adviser, Financial Institution or any Affiliate, Related Entity, or other party) or otherwise adhering to the Impartial Conduct Standards;”

2. The BICE pre-recommendation contract requirement is incompatible with customary

business practices in the financial services industry, and is simply impracticable.

As written, the BICE requires that a customer execute a contract prior to any discussion occurring. This requirement is inconsistent with the manner in which advisers currently conduct business – imagine walking into a store and being asked to sign a contract before you can view any of the store’s merchandise -- and creates significant operational challenges for most financial professionals’ business models.

23 80 FR 21987 24 See ERISA Advisory Op. 2001-01A (January 18, 2001). 25 We bring to the Department’s attention that the language of the preamble, which states that the Best Interest standard requires advisers to “put the interests of the Retirement Investor ahead of the financial interests of the Adviser”, which approaches the standard recommended by ACLI here.

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It is impractical for an investor to execute a legally binding contract before she can determine whether to do business with a financial professional. It is also impractical under standard corporate governance to have every employee of the firm and its affiliates enter into legally binding contracts on behalf of the firm. It is common that only those individuals at a relatively high level within the firm may execute contracts on behalf of the firm. Furthermore, the BICE would require a contract between the investor and each employee at the firm who may be treated as a fiduciary under the broad terms of this Proposal. As a practical matter, we expect the public would not find this to be a positive customer service experience. We request that a contract issued by the fiduciary or the fiduciary’s employer concurrent with a transaction executed through negative consent be sufficient.

Additionally, financial professionals generally begin their discussions with a new customer with a general consultation. This consultation may include a sales pitch in some form. It may also involve an offering of basic, high-level suggestions regarding investment strategies as a way to demonstrate their competency and communication style. The customer has an opportunity to ask questions about the adviser and to assess whether the services that the adviser offers meet his or her individual financial needs. The adviser may offer a pre-analysis with suggested approaches based on preliminary financial data from the potential customer. The adviser will also surmise whether the customer meets the adviser’s customer criteria. Only after the parties agree that the relationship would be mutually beneficial would the adviser then take the first “live order” and enter into an engagement agreement.

Requiring advisers to enter into an agreement during the first meeting in which a potential

“recommendation” is made is far too early in the relationship, and would require contracts to be executed prior to an adviser having a conversation about what products and services the adviser has to offer. ACLI members propose that the exemption require any contract to be executed within a “reasonable period of time” before or after the commencement of any trading or transaction activity. In order to protect prior recommendations, the contract could contain a provision that retroactively applies the Best Interest standard to any recommendations made prior to execution. The contract would provide that fiduciary status would affix concurrently with the receipt of compensation to the adviser.

In addition to creating operational difficulties for new customers, the need for a pre-

recommendation contract will frustrate the use of the BICE by financial institutions that employ staff to engage with benefit eligible participants seeking lump sum distributions. These interventions result in assets remaining in plans or in the savings system via rollovers, and reduce retirement plan leakage. A retro-active contract executed once the transaction commences would therefore preserve plan assets as well.

33. BICE contracts should be subject to negative consent and should not require the Adviser

to be a party.

The exemption should allow for negative consent to the BICE contract as the Department requires the key terms of the contract to favor the investor. In addition, the requirement that the adviser also be a party to the contract is inconsistent with industry practice, is unnecessary and would create operational headaches that would not benefit anyone. As long as the financial institution is a party to the contract and takes responsibility for the actions of its advisers then there would be no additional protection provided to the retirement investor by having the adviser be a party to the contract. However, it would be extremely difficult to operationalize this requirement where a retirement investor works with multiple advisers. Take for example a financial institution that provides plan participants or IRA owners with recommendations through a call center. Would each phone representative have to be a party to each contract or would calls have to be directed to the adviser or advisers that were a party to the contract for that particular plan participant or IRA owner? Either way, if there is any level of turnover then the contract would need to be amended to add new advisers on a constant basis. Even with respect to advisers who work in a close one-on-one basis with retirement investors it has become more common for these advisers to work in a team

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practice with advisers that specialize in different products and issues. Such a team practice environment acknowledges the difficulty in being an expert at everything and should be encouraged as it benefits retirement investors. However, it creates the same problem as the call center example above as turnover on teams is to be expected particularly as younger advisers decide to start up their own practices and are replaced with new advisers. For these reasons we respectfully request that the Department change the requirement to require that only the financial institution be a party to the contract.

44. The narrow scope of the exemption will eliminate an adviser’s ability to provide advice to

certain small plans and plan participants eligible for a distribution.

As it is currently written, the BICE is not available for fiduciaries that provide advice to small participant-directed plans. Clearly, the employers that offer these plans should have the same access to advice that is in their best interest as any other employer. There does not seem to be any policy reason to exclude these employers from receiving the guidance they currently enjoy and expect to continue to be available in the future. ACLI members request that these plans be included so as to not be inadvertently disadvantaged. In addition, under the Proposal, recommendations to distribute benefits and/or rollover benefits are fiduciary recommendations regardless of whether the recommendation identifies specific investments to purchase or sell. In Section I of this letter, we recommend a change to the definition of fiduciary that treats a distribution recommendation as advice only when it is in conjunction with a recommendation regarding the disposal or exchange of an investment. Should the Department refrain from incorporating our suggested change, we ask that the BICE be extended to distribution and rollover recommendations.

5. The BICE has implications under Investment Advisers Act for agents and brokers that

enter BICE agreements acknowledging fiduciary status. Investment Advisers Act of 1940 (the “Advisers Act”) establishes a clear line between selling agents who are primarily in the business of selling securities for a commission and investment advisers who offer advice regarding investments and receive a fee for their expertise in that regard. Under the Advisers Act, anyone who is in the business of providing investment advice for compensation must register as an investment adviser.26 However, in order avoid an overly broad application of the law, the Advisers Act specifically excludes certain individuals, companies, and services from coverage and registration. These include lawyers, accountants, engineers, and teachers who provide investment advice that is solely incidental to the practice of their profession; publishers of a bona fide newspaper, magazine, or financial publications that may include investment advice; and any broker or dealer whose performance of advice services is solely incidental to the conduct of his business, and who receives no special compensation therefore.27 Insurance-based broker-dealers have carefully complied with this requirement, taking great pains to provide no more than incidental advice in order to avoid the need to submit to the SEC’s regulatory scheme under the Advisers Act. The BICE will call these efforts into question, at best, and may involuntarily make broker-dealers subject to the Advisers Act, at worst. BICE will require broker-dealers to admit fiduciary status at the outset of any sales transaction, irrespective of whether any investment advice provided by the broker is incidental to the sale of a product. This admission of fiduciary status will likely cause the broker-dealer to fall outside of the current Advisers Act exception for non-fiduciary, 26 Section 202(a)(11), Investment Advisers Act. 27 Certain Broker-Dealers Deemed Not To Be Investment Advisers, Investment Advisers Act Release No. 2376 (Apr. 12, 2005) (“Release 2376”), available at http://www.sec.gov/rules/final/34-51523.pdf.

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“incidental” advice, and may obligate the broker monitor that advice on an ongoing basis. This will be the case despite the fact that most investors do not expect, or may not want to pay additional fees for such monitoring by a broker-dealer who is primarily a sales agent.

Ultimately, the true impact of the required fiduciary declaration under the BICE for Advisers Act purposes will rest with the SEC. Given this potential conflict between the BICE and the Advisers Act, ACLI encourages the Department to coordinate with the SEC as part of the BICE comment and review process in order to manage this conflict. If the fiduciary declaration requirement is made part of the final BICE, ACLI further requests that the Department work with the SEC to issue guidance contemporaneous with the final BICE that offers comfort that broker-dealers will not be subject to statutory investment adviser status by seeking the protection of the exemption.

6. The exemption’s requirements for advisers that offer a limited range of investment options or proprietary products render it unfeasible.

ACLI members recommend that the Department eliminate the requirements in Section IV, instead, require the fiduciary to disclose to the investor if the fiduciary offers only certain types of investments or proprietary products and whether the fiduciary is subject to any other limits on its advice recommendations. The exemption currently requires a financial institution to offer a range of investment options that is broad enough to enable the adviser to make recommendations from all of the asset classes reasonably necessary to serve the investor’s Best Interest. This requirement is simply unfeasible in a number of respects. We have several concerns with this requirement. First, this suggests that the BICE is not available to financial institutions that specialize in one type of product or investment. For instance, a broker who specializes in international bonds would apparently not be able to use the BICE even if they were willing to be held to a best interest standard when selling those bonds to an IRA or retirement plan. Second, the Department has not identified any objective standard for determining what this test would require. Our members feel strongly that they do offer a broad range of investment options such that advisers can make recommendations in the best interest of clients. However, subsection (b) provides additional rules where an investment provider has limited the Assets available for purchase, sale or holding based on whether the Assets are Proprietary Products, generate Third Party Payments, or for other reasons. It is not clear how subsections (a) and (b) are meant to work together. We would note as a threshold matter that we know of no Financial Institution that makes every Asset available for purchase. On the other hand, virtually every Financial Institution makes a range of investment options that is broad enough to permit advisers to make recommendations in the best interest of clients. Thus, it is entirely unclear whether anyone or everyone is required to meet the heightened requirements of subsection (b). To the extent that subsection (b) is determined to apply, our members assert that it is inappropriate, at best, for the Department to require an investment provider to offer any specific product or range of products, or to require an adviser to disclose if the he or she does not offer every product ever made available in the marketplace. Insurers, as product providers, and agents and brokers who sell these products should have the freedom to choose what products are offered without an undefined disclosure that the products offered are “limited,” especially if the product recommended meets customer needs. For broker dealers, the discrimination regarding products offered is the result of careful due diligence and vetting for FINRA Rule 2111 suitability standards, and is not a reflection of a lack of prudence in recommendation of securities. Even if an institution is a fiduciary, the decision by a financial institution to decide which products or investment funds to offer on its platform is a settlor function. Based on a firm’s individual business models, risk profiles, and particular customer-bases, each firm makes its own independent determination as to which products to offer.

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Second, the impartial conduct standard of Section II already requires the adviser to make recommendations that are in the best interest of the client and the reasonable compensation provision requires that the total compensation paid by the retirement investor is reasonable in light of the services they have received. It is difficult to understand why the Department feels it necessary to layer on even more requirements unless it is to make absolutely sure no firm that sells proprietary products or receives third party payments can use the exemption. If that is the Department’s intent, then the Department needs to do so in a transparent manner so that financial services firms can have a meaningful opportunity to comment. Furthermore, the reasonable compensation requirement at Section IV(b)(2) differs from all of the other instances in which reasonable compensation applies within the Proposal, the BICE and other prohibited transaction exemptions including ERISA §408(b)(2). This particular requirement is not business model neutral, but rather envisions the deconstruction of products and services into a la carte offerings. How one will determine the fair market value of a 1-800 call center, internet or mobile app account service? If such services are made available, but not used, have they been “specifically provided?”

77. The required BICE disclosures should be harmonized with other disclosures.

The Department should consider the effects of its proposed BICE disclosures on plan participants and IRA owners. The BICE disclosures are to be delivered in addition to all other applicable disclosures required by ERISA and other federal and state law. At the very least, the Department should seek to align the BICE requirements with ERISA’s existing disclosure regime. ACLI members would propose substantial changes to the initial, annual, point-of-sale, and website disclosures required under the exemption. The insurance and financial services industries have consistently supported disclosure requirements to mitigate potential conflicts. We also believe that markets should hold firms accountable to ensure that fees are reasonable. However, firms do not currently have the capabilities necessary to comply with the disclosure rules. Much of the information requested by the Department does not exist in the format requested or must be obtained from third parties, such as fund manufacturers. For liability reasons, it would be inappropriate for advisers and firms to deliver third-party data on projected costs, for instance, without any way to verify that data. In addition, the disclosures may be cost-prohibitive for small firms to develop a disclosure system that would comply with the exemptions’ requirements, limiting annuity sales opportunities for those institutions.

We are particularly concerned about the annual disclosure because it requires the disclosure of all compensation paid to the adviser and financial institution. The requirement is so broad that the Department has not been willing to state that it would not require the disclosure of spread revenue. Spread revenue is earned by financial institutions in a wide range of products including bank deposits, corporate bonds, and fixed accounts within both fixed and variable annuity products. No financial institution can determine the exact amount of spread revenue it has earned over any particular period not should it have to. The Department has consistently, and appropriately, considered spread revenue to be outside the term “compensation” because it is more accurately considered to be akin to investment earnings. The financial institution takes on risk and if it successfully manages that risk it earns spread revenue. However, in some cases the financial institution may experience risk losses and lose revenue. The Department should clarify in BICE that spread revenue is not compensation that the financial institution must disclose on an annual basis or on its website.

Second, it will be extremely difficult if not impossible for firms to identify the total indirect

compensation paid by each retirement investor on its platform. In particular, it will be extremely expensive for financial institutions to track the movements of each retirement investor’s account and then match up the retirement investor’s holding each day with the internal expense ratio of each

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investment. Such detailed disclosure is not required under the Department’s 404(a)(5) disclosures presumably because it would be too costly yet the Department somehow thinks it would be feasible under the BICE.

Third, the website disclosure would require the development of a website that included

specific information related to every investment available on the financial institution’s platform. For many brokers, this would require disclosure at the CUSIP level of thousands and thousands of individual stocks, bonds, mutual funds, ETF’s, variable annuities, etc. Even worse, because the website must include specific information related to how much an adviser is paid on each of these individual CUSIPs, a financial institution would likely have to create a separate website disclosure for each financial adviser! This could mean the creation of 10,000 websites for a financial institution who compensates advisers differently depending on a number of factors. This is not some hypothetical issue but rather the customary way that brokers pay their registered representatives today.

Fourth, the reporting obligations of Section IX are truly unprecedented. We particularly object to the concept of the Department gathering account level data related to our customers (including unique identifiers necessary for the Department to track each client’s individual returns and tie those returns to their adviser) and then reserving the right to publish that data aggregated at an adviser level. The idea that the Department would identify individual advisers on its website along with the rate of return of the advisers’ client is truly misguided. We note that the Department has not requested any specific information related to the adviser’s clients that might be helpful in informing an opinion as to whether the adviser is doing a good job for each client. For instance, the Department is not looking for the age or risk tolerance of the adviser’s clients, whether the adviser made any recommendations to the client and/or whether the client followed such recommendations, or whether other factors might have played a role in the returns such as an investment strategy that was otherwise sound but did not work well in a particular market environment. Instead, the Department appears satisfied to use such data to impugn the reputation of any adviser whose clients experience a lower return than the clients of other advisers even when that adviser provides services to more conservative investors. The Department should not take any step that may discourage advice that includes a recommendation to invest in a fund with low risk/return characteristics.

Even if the Department did not threaten to publish the data, the mere collecting of client data is very troubling. Given recent headlines related to data held by the federal government that was hacked by third parties, we suspect that many investors will be concerned that their data is being handed over to the federal government. Information disclosures should be meaningful and actionable for retirement investors. The current disclosures under ERISA sections 408(b)(2) and 404(a)(5) should, in fact for point of sale purposes, suffice for many accounts. Those disclosures require detailed information regarding “reasonable compensation,” much of which overlaps with the information requested under the BICE. Additionally, the annual disclosures required under Form 5500 Schedules A and C are not coordinated with the newly required annual disclosures in the BICE. Complying with the disclosure requirement by referencing existing ERISA disclosures will reduce the potential for investor information overload, and will make it more likely that investors will recognize the importance of the disclosure regime that the Department has worked very hard to develop for the retirement plan market. To the extent that existing ERISA disclosures are not sufficient (for instance, in the IRA context), the Department should harmonize BICE disclosures with other disclosure regimes already existing in the securities industry. For instance, advisers should be permitted to disclose information requested by reference to documents such as the Form ADV disclosure, the prospectus, the NSCC database, some variation of the “compensation grid” used by used by a firm or adviser, the

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SEC/FINRA “fund analyzer”, and certain private, independent 3rd party data sources on variable annuities. Regarding IRAs, the Department should consider harmonizing the BICE point-of-sale disclosure requirements with current IRA disclosure requirements under Treasury Regulation. §1.408-6. We understand that the Department may be reluctant harmonize BICE disclosures with the current compensation and fee disclosure requirements issued pursuant ERISA section 408(b)(2), since these requirements apply only to plans, not IRAs. However, because IRAs are already subject to a separate, comprehensive cost and fee disclosure regime under Internal Revenue Service regulations, we encourage the Department to harmonize the BICE point-of-sale disclosures for IRAs with these existing rules. Pursuant to Treasury Regulation §1.408-6, IRA providers must give IRA owners certain disclosures upon the establishment of an IRA and periodically thereafter. The regulations require providers to issue a disclosure statement and a copy of the governing instrument to the owner at establishment of the IRA, and to update these later with any amendments. The disclosure statement must set forth, in nontechnical language, concise explanations of the requirements of Code section 408, the income tax consequences of establishing the account and certain statements regarding the consequences of engaging in a prohibited transaction. In addition, the disclosure statement must also contain a financial disclosure explaining the potential value of the account at various points in the future. The disclosure must comply with different rules depending on whether any assets are subject to guaranteed contracts. If no amount is guaranteed under the account and no projection can be made, the financial disclosure must assume level annual contributions of $1,000 and must describe, in nontechnical language, (1) each type of charge (and amount) which may be made against a contribution, (2) the method for computing and allocating annual earnings, and (3) each other charge which can be applied to the account in determining the net amount of money available to the IRA owner. These existing disclosure requirements for IRAs approximate, in streamlined form, the information required under proposed BICE point-of-sale disclosure requirements. Allowing this disclosure (or a substantially similar form of this disclosure) to stand as the point-of-sale disclosure for IRAs under the BICE achieves the Department's goals of making the total cost of the IRA "clear and salient" to the Retirement Investor, providing cost information that can be compared across different Assets, an informing the Retirement Investor of the impact of costs for the IRA over time. In addition, these disclosures would be combined with the disclosures required for the underlying investments, such as mutual funds, to provide even greater cost transparency for IRA owners. ACLI members have been encouraged by recent statements from the Secretary suggesting that the Department will work to deliver finalized guidance that "accomplishes [the Proposal's] goals in the simplest, least burdensome way for all concerned". We encourage the Department to take a small step forward in this vein by harmonizing the BICE point-of-sale disclosure requirements with the existing IRA disclosure requirements under Treasury Regulation §1.408-6.

8. Forego a “low cost” prohibited transaction exemption.

We agree with the Department’s repeated caution to plan fiduciaries that fees are a consideration but certainly not the only consideration, and we believe that caution answers why a low cost prohibited transaction exemption would be inappropriate. The only rational response to such an exemption would be for a fiduciary to avoid offering certain services and products in order to achieve the fee level required for the fiduciary to rely on the low cost prohibited transaction exemption. Not only would that be a grave error on its own, it would substantially reduce the likelihood that critical retirement lifetime income guarantees would be available to individual plan

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participants and IRA owners. Rather than push for a streamlined exemption for the types of investments the Department may favor at this time, we would urge the Department to resist the urge to pick winners and losers and rather let the market decide which products should be offered in the marketplace. We believe the Department should work to make the BICE a streamlined and workable exemption.

99. The BICE language, at various points, should be amended to target actual, rather than perceived, conflicts.

It is common for a plan sponsor to designate a menu of plan investments from which participants and beneficiaries may select. In so doing, a responsible plan fiduciary must determine whether the compensation to be received by the financial institution providing such investments receives reasonable compensation for its services. We suggest that when advice is provide to plan participants and beneficiaries regarding the plan’s designated investments, there is no need for fiduciary advisers to second guess the plan’s determination regarding the reasonableness of any compensation to be received. We recommend Section II(c)(2) be revised as follows:

“… regarding the Asset other than an Asset which is a designated investment alternative under the Plan, ….”

State law bars insurers from making false statements. Clearly, statements on which an investor relies for her investment decision must not mislead. However, the phrase “relevant to a Retirement Investor” raises a subjective rather than objective analysis of whether or a particular statement is “misleading.”

We recommend Section II(c)(3) be revised to provide greater certainty as to the exemption relief offered by the BICE:

“(3) The Adviser’s and Financial Institution’s statements about the Asset, fees, Material Conflicts of Interest, and any other matters relevant to reasonably relied upon by a Retirement Investor’s when making an investment decisions, will are not be misleading.

V. The proposed transition rule should be revised and expanded.

We urge the Department to make application of a final regulation, including changes to prohibited transaction exemptions (particularly PTE 84-24) prospective only to apply to fiduciary advice with respect to retirement accounts opened or insurance contracts issued after the regulation’s compliance date. Prospective application would allow for continued ongoing customer assistance for existing accounts. This is particularly important for commission-based annuity contracts, as retirement investors may have already paid for services. If the Proposal is applied retroactively, annuity owners would incur additional expense to transition to fee-based arrangements. For IRA owners with variable annuity contracts sold in reliance on PTE 84-24, the Proposal does not provide recourse for advisors and investors who have relied on this exemption in good faith. Without a reasonable grandfather provision, IRA owners may be compelled to surrender their annuity contracts to obtain advice. While ACLI appreciates that the Department has included a form of transition relief in its BICE proposal, such relief is extremely narrow, and it is questionable whether it provides any meaningful relief beyond what would be provided by operation of law.

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First, transition relief should be provided for excluded assets. Investments that do not meet the definition of “Assets” under the BICE may not be liquid and readily sold. As a result, financial institutions will have no way to dispose of these assets prior to the effective date of the new regulatory regime. Even when liquid, financial institutions generally do not have discretionary authority to sell out an investor’s account. The only way for an institution to “get rid” of these investments is to resign as the IRA custodian which may result in a taxable distribution and potentially a 10% early withdrawal penalty. It seems unlikely that this is the intent of the Proposal, yet there is no discussion of this issue in the preamble or regulatory impact analysis.

At a minimum, fiduciaries should be able to make sell and hold recommendations on any investments that the Department excludes from relief under the BICE, to the extent that the excluded assets were purchased before the regulation became effective. Furthermore, to the extent that the excluded asset includes rights that are appurtenant to the investment, fiduciaries should be able to provide recommendations related to the exercise of those rights as long as the fiduciary does not earn additional compensation related to such recommendations.

Second, relief is needed for existing customers who reject the Best Interest Contract. When a new contract requirement is imposed, it is inevitable that there will be some percentage of customers that will not sign or agree to the new contract. Even if the Department permits negative consent as we have requested, there may be agreements in place that do not permit amendments via negative consent. Transition relief is necessary to permit the financial institution to amend existing contracts or bring an orderly close to these accounts. Third, if transition relief is not expanded, investors will be unable to obtain any information about existing products from service providers unwilling or unable to service in an ERISA fiduciary capacity.

VVI. Eight month delayed applicability date is unreasonable.

Assuming the substantial modifications necessary to make the exemption workable raised here, compliance with the Proposal will be a major undertaking for financial institutions and advisers. The Proposal will not be administrable within the proposed applicability date of 8 months from the publication of a final exemption. ACLI recommends the Department provide at least three (3) years for the public to digest the final rule and the final exemptions, including the final amended PTE 84-24 (the Department plans to provide at least 140 days for a review of the Proposal), plan and implement changes to comply with the rule including the development and implementation of proper disclosures, the training of advisers to ensure compliance with each of the conditions, a review of all marketing materials, and the building appropriate supervisory procedures. Of note, the Department provided two years from the publication of interim final regulations under ERISA Section 408(b)(2) and the effective date of final regulations.

VII. The cost-benefit analysis in the Proposal is deficient.

Congress, courts, and the executive branch of government have issued unequivocal guidance mandating thorough, objective cost-benefit analysis in rulemaking. Collectively, these standards ensure that federal agencies “strike the right balance,” and develop “more affordable, less intrusive rules to achieve the same ends--giving careful consideration to benefits and costs.”28 Notwithstanding its extensive “regulatory impact analysis,” the Department of Labor failed these standards by overstating benefits, understating costs, and disregarding harm to small retirement plans. Our suggested revisions

28 Op-Ed, President Barak Obama, Toward a 21st Century Regulatory System, Wall Street Journal (Jan. 18, 2011). The President’s Op-Ed coincided with his issuance of Executive Order 13,563, which set strict standards for cost-benefit analysis in federal agency rulemaking.

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to the rule rectify these shortcomings, and more accurately balance benefits against costs. The cost-benefit standards and deficiencies are explained below.

AA. Executive, statutory and judicial precedent.

Executive branch mandates for cost-benefit analysis began in 1981 with Executive Order 12,291 that created a new procedure for the Office of Management and Budget (OMB) to review proposed agency regulations, and ensured the president would have greater control over agencies and improve the quality and consistency of agency rulemaking. Cost-benefit analysis formed the core of the review process. The order unambiguously stated that “regulatory action shall not be undertaken unless the potential benefits to society for the regulation outweigh the potential costs to society.”29 Regulatory agencies, therefore, must balance the benefits of proposed rules against their costs. In 1993 Executive Order 12,866 superseded the 1981 order, but retained cost-benefit analysis as a fundamental requirement in rulemaking. Executive Order 12,866 instructs that “in deciding whether and how to regulate, agencies should assess all costs and benefits of available regulatory alternatives, including the alternative of not regulating.”30 In a manner parallel to the 1981 order, Executive Order 12,866 advises that agencies must perform their analysis and choose the regulatory approach that maximizes net benefits.31 President Obama reaffirmed the importance of cost-benefit analysis in 2011 through Executive Order 13,563, and reinforced the core principles in Executive Order 12,866 by emphasizing that “each agency must . . . propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs.”32 Importantly, five administrations between 1981 to present have consistently made cost-benefit analysis a threshold for federal agency rulemaking. The OMB provided federal agencies with extensive guidance to perform cost-benefit analysis in its Circular A-4.21 C33, which identifies three fundamental elements to federal agency rulemaking: (i) a statement of the need for the proposed regulation; (ii) discussion of alternative regulatory approaches; and, (iii) an analysis of both qualitative and quantitative costs and benefits of the proposed action and the leading alternatives. The analysis should attempt to express both benefits and costs in a common measure—monetary units—to facilitate the assessment. When benefits or costs cannot be quantified in monetary terms or in some other quantitative measure, the agency should describe them qualitatively.34 The Administrative Procedure Act (APA) provides comprehensive standards governing federal agency rulemaking, and includes guideposts for judicial review of agency rulemaking under an arbitrary and capricious threshold. The Regulatory Flexibility Act (RFA) of 1980 (5 U.S.C. §§601-612) requires federal agencies to assess the impact of their forthcoming regulations on “small entities,” which the RFA 29 46 Fed. Reg. 13193, 13193 (Feb. 17, 1981). 30 Exec. Order No. 12,866, 3 C.F.R. 638 (1993). 31 The 1981 and the 1993 executive orders emphasize different approaches to the same cost –benefit end. The 1981order required that the benefits “outweigh” the costs, while the 1993 order required only that the benefits “justify” the costs. See generally Peter M. Shane, Political Accountability in a System of Checks and Balances: The Case of Presidential Review of Rulemaking, 48 ARK. L. REV. 161, 176-78 (1994) (comparison of 1981 and 1993 executive orders with additional detail and observing that the 1993 “order focuses on a similar mandate, but describes it with greater nuance”). 32 Exec. Order 13,563, § 1(b), 76 Fed. Reg. 3821 (Jan. 18, 2011). The order further notes that “each agency is directed to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” Additional analysis of this order can be found in Helen G. Boutrous, Regulatory Review in the Obama Administration: Cost-Benefit Analysis for Everyone, 62 ADMIN. L. REV. 243, 260 (2010). 33 Office of Mgmt. & Budget, Circular No. A-4, Regulatory Analysis (Sept. 17, 2003), last available at http:// www.whitehouse.gov/OMB/circulars/a004/a-4.pdf. OMB invited full public comment on his 48-page circular in draft form, which contains detailed instructions about conducing cost-benefit analysis, and provides a standard template for running the analysis. 34 To ensure that agencies properly perform cost-benefit analysis and select the most cost-effective regulatory options, OMB and the White House Office of Information and Regulatory Affairs (OIRA) review agency cost-benefit analysis before proposed regulations become effective.

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defines as including small businesses, small governmental jurisdictions, and certain small not-for-profit organizations. Under the RFA, cabinet agencies must prepare a “regulatory flexibility analysis” when final rules are issued. The RFA requires the analysis to describe, among other things, (1) reasons why the regulatory action is being considered; (2) small entities to which the proposed rule will apply and, where feasible, an estimate of their number; (3) projected compliance burdens of the proposed rule; and (4) any significant alternatives to the rule that would accomplish the statutory objectives while minimizing the impact on small entities. In three significant cases involving SEC rulemaking beginning in 2005, the Court of Appeals for the District of Columbia Circuit overturned major rules due to the SEC’s failure to conduct adequate cost-benefit analysis which the court viewed as arbitrary and capricious actions contrary to the mandates of the APA.35 The holdings depart from the court’s traditionally more deferential approach to review of agency rulemaking in other administrative law contexts and provide a template for measuring appropriate cost-benefit analysis in federal agency rulemaking. These three rulings are significant because they were rendered by the federal court that typically reviews agency actions and, thus, serves as a touchstone for appropriate federal rulemaking in general. Additionally, the rulings provide an avoidable roadmap to litigation for insufficient cost-benefit analysis in rulemaking. On June 29, 2015, the U.S. Supreme Court underscored the primacy of a carefully balanced and quantified cost-benefit analysis in federal agency rulemaking. 36 In sum, therefore, the guidance established by statutes, executive Orders, and seminal recent court cases strongly warrant a more carefully balanced and detailed cost-benefit analysis before the Proposal moves forward.37

BB. Measuring the regulatory impact analysis against executive, statutory and judicial precedent.

The Proposal was accompanied by a 243 page “regulatory impact analysis” and seven supporting documents.38 While significant in length, this cost-benefit analysis is fundamentally flawed in several significant respects, particularly as it pertains to variable annuities. The Department justifies its Proposal with the claim that there is a “substantial failure in the market for retirement advice”.39 The Department’s analysis fails to prove this assertion and contains at least three significant flaws which undermine its proposed solution. Specifically, the regulatory impact analysis: (1) calculates the cost of conflicted advice and the benefits of the proposed rule through selective and imbalanced use of academic studies of mutual funds that are misinterpreted and misapplied to the entire market for retirement advice; (2) overlooks the negative impact of the proposed

35 See Chamber of Commerce v. SEC, 412 F.3d 133 (D.C. Cir. 2005), Am. Equity Inv. Life Ins. Co. v. SEC, 613 F.3d 166 (D.C. Cir. 2010), and Bus. Roundtable & U.S. Chamber of Commerce v. SEC, 647 F.3d 1144 (D.C. Cir. 2011). In the Business Roundtable and US Chamber of Commerce case, the D.C. Circuit overturned proxy access Rule 14a-11 adopted by the SEC in August 2010. The court determined that the SEC's failure to "apprise itself—and hence the public and the Congress—of the economic consequences of a proposed regulation" made promulgation of the rule arbitrary and capricious and not in accordance with law. The American Equity case involved the SEC’s adoption of Rule 151A under the Securities Act of 1933 which provided guidance as to whether fixed index annuities were entitled to rely on the exclusion provided under Section 3(a)(8) of that act. The court indicated that the SEC did not disclose a reasoned basis for its conclusion that Rule 151A would increase competition and the SEC did not make any finding as to existing level of competition in the marketplace under state insurance law regimes or the efficiency of existing state insurance law regimes. The Court remanded Rule 151A back to the SEC for “reconsideration,” solely because it found that the SEC had not given proper consideration to the rule's effect on “efficiency, competition, and capital formation” in the annuity industry. 36 Michigan v. EPA, No. 14-46 (June 29, 2015) http://www.supremecourt.gov/opinions/14pdf/13-1314_3ea4.pdf. In this case, the Court sent a rule under the Clean Air Act back to the EPA to objectively quantify and balance the benefits and costs under the rule before it could become operative. 37 See generally Peter M. Shane, Political Accountability in a System of Checks and Balances: The Case of Presidential Review of Rulemaking, 48 ARK. L. REV. 161, 176-78 (1994). 38 Department of Labor documents pertaining to the proposed rule can be found here: http://www.dol.gov/ebsa/regs/conflictsofinterest.html. 39 U.S. Department of Labor, “Fiduciary Investment Advice: Regulatory Impact Analysis”, April 14, 2015, p. 7.

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rule on lower-wealth investors, the likelihood that the supply of financial advice will decline and price of advice increase, and the increased costs inflicted on employer plan participants; and, (3) bases estimates of direct costs of the Proposal on inadequate and incomplete data and insufficient consideration of the time required to implement changes necessary to comply with the Proposal. Additionally, though the proposed rule and cost-benefit analysis mention annuities a total of 172 times and acknowledge that “31 percent of IRAs include investments in annuities” (p. 54) and that “insurance companies [will] be significantly affected by the proposal” (p. 56), the cost-benefit analysis makes no attempt to examine the impact of the proposed rule on insurers, the annuity market, or on the availability of lifetime income, nor does it attempt to assess the value of variable annuities or their role in retirement security.

11. The statement of potential benefits is flawed.

The Department justifies the need for the proposed rule based on a selective review of six

refereed studies and three working papers (see pp. 95-96 of the CBA for the complete list of studies),40 Though the primary justification of the proposed rule is the elimination of conflicts of interest, the Department admits that “[n]one of these papers attempts to detect some major possible sources of underperformance of IRA assets attributable to conflicts of interest” (p. 97). The studies do, however, focus on either the returns of load vs. no-load mutual funds or the returns of broker-sold vs. direct-sold mutual funds. Most of these studies found that during the period under consideration broker-sold front-load mutual funds (which comprise only about 13 percent of the IRA market) may not have performed as well as other funds and that direct-sold mutual funds may have performed better than broker-sold mutual funds. None provide support for the assertion that fiduciary-advised accounts perform better than other types of accounts. The Department relies on these very narrowly focused studies as proof of market failure and does not utilize other bodies of work which would be useful for their analysis, such as the literature on the benefits of using a financial adviser.41 Based on the cited studies, and on the assumption that IRA holders who purchase broker-sold front-load mutual funds received conflicted investment advice which resulted in lower returns,, the Department determined that investors holding such funds can expect their investments to underperform by an average of 100 basis points annually. Using this figure and implicitly assuming that this level of underperformance will continue and that investors will not adjust their portfolios, the Department concludes that “underperformance associated with conflicts of interest -- associated with the mutual fund segment alone -- could cost investors more than $210 billion over the next 10 years and nearly $500 over the next 20 years (p. 13).”42 The Department contends that if the Proposal is adopted and conflicted advice eliminated, costs would be lowered, and IRA investors would benefit by “approximately $40 billion over 10 years and almost $90 billion over 20 years (p. 101).”

40 A comprehensive review of the studies referred to in the DOL's CBA can be found in: Berkowitz, Jeremy; Comolli, Renzo; Conroy, Patrick, “Review of the White House Report Titled ‘The Effects of Conflicted Investment Advice on Retirement Savings’”, NERA Economic Consulting, March 15, 2015. 41 Montmarquette, Claude; Viennot-Briot, Nathalie, “The Value of Financial Advice”, Annals of Economics and Finance, vol 16., no. 1, pp 69-94, 2015. This study finds that over the course of several years, investors who use advisers obtained greater returns than those who don’t. For an explanation of the role and value of life insurance agents in assuring retirement security, see: Rosh, Robert M., “Death of a Salesman: The Rise and Unfortunate Potential Demise of the Full-Time Life Insurance Salesman”, St. John’s Law Review, vol. 88, Winter 2014, No. 4, pp. 985-1021. 42 Throughout their analysis the Department provides a very wide range of cost estimates associated with conflicted advice and with the benefits of the proposed rule. On the lower end, the Department estimates that the “expected gain would total between $20 billion and $22 billion over 10 years (p. 108)”. On the higher end, the Department estimates that “under current rules, advisor conflicts could cost IRA investors as much as $410 billion over 10 years, and $1 trillion over 20 years (p. 8)”, and that “underperformance associated with conflicts of interest ... could cost IRA investors $210 to $430 billion over the next 10 years and approximately $500 billion to $1 trillion over the next 20 years (p. 211)”. In a related analysis, the Council of Economic Advisors estimates that conflicted advice costs investors $17 billion annually.

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There are, however, at least three major weaknesses in relying on these studies and estimating the benefit of the proposed rule based on their results. First, all of the studies use data from the 1990s and early to mid 2000s. This is highly problematic because competition has significantly increased in recent years, driving down fees. In effect, the market has changed such that any analysis based on old data is in no way applicable in the current market and should not be used to formulate or substantiate regulations. For example, contrary to the findings of the cited studies, by some estimates, front-load fund shares sold between 2007 and 2013 outperformed Morningstar average returns for all funds with similar objectives by 27 basis points per year.43 Secondly, none of the cited studies examine a representative sample of investor portfolios through time, but rather the performance of one type of mutual fund at one point in time. The relative performance of only one type of fund in a given year offers a very limited view of the world. By relying solely on the cited studies to formulate the cost estimates of conflicted advice and benefit estimates of the proposed rule, the Department implicitly assumes that all investors, whether using a broker or not, are “buy and hold” investors. This is not a realistic assumption. In a competitive market, if returns are low investors will eventually shift their assets to more appropriate funds. Ideally, the performance of representative samples of entire portfolios which would include various types of funds and annuities, through time, should be considered. Such an approach would more properly control for critical additional factors, including demographics, wealth, investor sophistication, and different levels of risk tolerance, generating a more accurate analysis of the market. Although the working paper by Chalmers and Reuter cited in the Department analysis consider portfolio-level data, their sample is not representative of the US population -- and their data is unacceptably stale.44 Chalmers and Reuter examine defined contribution plan accounts of faculty and administrators employed by the Oregon University System from 1996 to 2007. This is hardly representative of the general U.S. population today. Finally, though results may be fairly consistent with regard to front-load mutual funds sold through broker-dealers in the 1990s and part of the 2000s, the results concerning other types of investments, such as revenue-sharing mutual funds, are much less conclusive. In fact, Christoffersen, Evans, and Musto (2013), a study the Department analysis relies upon most heavily and which appears to underpin all of the Department’s benefit estimates, do not contain strong evidence of a negative relationship between broker-sold revenue-sharing mutual funds and performance, suggesting that the Department may have selectively used more favorable results to estimate the benefit of the proposed rule. For these reasons, the cited studies should not be used to justify the need for, or determine the potential benefits of, the proposed rule and should not be relied on to formulate well-intentioned rules which can, in fact, have a detrimental impact on plan participants, particularly retirees and pre-retirees, as well as the financial services industry overall.

22. The Proposal inflicts an “advice gap” on individuals who can no longer obtain financial advice.

In the Proposal, the Department acknowledges that a comprehensive analysis of the proposed rule “would consider pure social welfare costs – that is, reductions in economic efficiency – which are not the same as simple compliance costs (p. 99)”. Although the Department analysis evaluates indirect effects and social welfare implications, including the impact on supply and demand for advisory services, it does so inadequately and unrealistically.

43 Statement of Brian Reid, Chief Economist, Investment Company Institute, Hearing on “Restricting Access to Financial Advice: Evaluating the Costs and Consequences for Working Families and Retirees”; Subcommittee on Health, Employment, Labor, and Pensions’ Committee on Education and the workforce; United States House of Representatives, June 17, 2015. 44 Chalmers, John; Reuter, Jonathan, “What is the Impact of Financial Advisors on Retirement Portfolio choices and Outcomes?”, working paper, May 6, 2014.

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The Department cost-benefit analysis asserts that:

“Advisers can provide the same quality of advice while receiving non-conflict-based payments as they can when receiving a payment of equal amount based in conflict. The cost of advice depends primarily on the resources necessary to provide it ... rather than the form of the adviser’s compensation. Thus, an adviser receiving payment through non-conflicted structures should be able to provide advice at the same cost as an adviser receiving conflicted payments, as long as the inputs in time and infrastructure are equal (p. 217)”.

It is unclear why the Department assumes that inputs in time and infrastructure would be equal or that the market for financial advice would not change. The price of financial advice is determined by supply and demand. The time, resources and financial burdens of complying with the proposed rule will be greater than under current regulations. This, along with the increased risk of litigation, will induce some advisers to leave the business, lowering supply and increasing the price of advice. This will be particularly true of life insurance agents, a very large percentage of whom are nearing retirement age. Because consumers will face a higher price, many will be priced out of the market and may face the prospect of retirement planning without a financial professional. The advisers who remain in business are more likely to focus on wealthier customers. An increase in the cost of advice and fewer financial professionals will most impact small account IRA rollovers, the segment of the market the Department is most concerned with. In fact, most IRA rollovers are for small amounts. In 2013, 61.4% of IRA rollovers were for amounts less than $50,000 and 75.1% were under $100,000.45 Almost half (47.8%) were for amounts less than $25,000.

Though the cost-benefit analysis claims the opposite, there is compelling evidence that following the introduction of the Retail Distribution Review (RDR) in the U.K., which the Department extols in support of the Proposal, a significant percentage of small investors were priced out of the market and are now considered ‘stranded customers’. Due to the parallels between the Proposal and the RDR, the same regrettable consequences may also occur in the US due to the Proposal if adopted. In June 2006 the United Kingdom’s financial regulator, the Financial Services Authority (FSA), created its Retail Distribution Review (RDR) program with the intention of enhancing consumer confidence in the retail investment market and eliminating ‘conflict risk’. In June 2007, the principal discussion paper on RDR was published, and on December 31, 2012, the RDR was implemented. The RDR has three general components: (1) a clear division between independent and restricted advice; (2) a ban on commissions; and, (3) greater minimum qualifications for investment advisers and a requirement that knowledge be maintained. Critics were concerned that the RDR would inherently change the incentives faced by investment advisers resulting in fewer advisers and a shift in focus toward high net worth investors, resulting in an ‘advice gap’ and a large number of ‘stranded customers’. Their assessment was correct. Though the RDR was implemented at year-end 2012, the UK’s financial services industry was adjusting to the coming changes in the years leading up to implementation. The number of investment advisers was steadily declining pre-RDR. According to the Association of Professional Financial Advisers (APFA), in 2010 there were 43,937 investment advisers in the U.K. and by 2013 there were 31,132, almost a 30% decline. This decline can be primarily attributed to the new qualification standards and the ban on commissions, and to many older advisers choosing to retire earlier than they had planned rather than navagate the new system. There is also evidence that there is indeed a growing ‘advice gap’. According to data collected by the APFA, in the years leading up to the implementation of RDR, about two-thirds of financial product sales took place with the help of an adviser. By 2012/2013 (the latest data available) this had declined 45 Copeland, Craig, Individual Retirement Account Balances, Contributions, and Rollovers, 2013; With Longitudinal Results 2010-2013: The EBRI IRA Database, Employee Benefit Research Institute, no. 414, May 2015.

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to half and has likely declined since. This is further supported by the results of an annual survey conducted by Mintel, a well-respected marketing research firm. Mintel has administered an annual survey of retail financial advice for U.K. investors since 2009. Their data shows that the number of investors who received financial advice in the wake of the RDR regulation has declined dramatically (see table below). In fact, about half as many investors get advice from the largest advice channel in the U.K. than before the regulations took effect, and the second largest channel has been on a downward trend since the RDR was implemented on December 31, 2012.

FFinancial Advice Usage in the U.K.*

Year Bank or Building Society Staff/Adviser

Independent Financial Adviser or Planner

Total

2009 32.0% 22.0% 54.0% 2010 28.0% 24.0% 52.0% 2011 29.0% 14.0% 43.0% 2012 31.0% 12.2% 43.2% 2013 24.5% 17.3% 41.8% 2014 20.3% 14.7% 35.0% 2015 16.0% 12.2% 28.2%

*Source: Mintel. Survey response to “which of the following, if any, have you used for financial advice in the last 3 years?”. A recent City University of London study noted that “the unintended consequences of the RDR initiative, accompanied by rapid change in technology and social media, is likely to further extend the ‘advice gap’, leaving aside those who have too few assets to merit attention from professional advisers, though they may well be in need of financial advice. This is an undesirable outcome (see Clare, Andrew; Thomas, Stephen; Walgama, Omal; Makris, Christina, “The Impact of the RDR on the UK’s Market for Financial Advice: Challenge and Opportunity”, Cass Consulting, Cass Business School, City University of London, June 2013). An August 28, 2014 story by Morningstar UK reported that “eleven million investors consider financial advice too expensive and have fallen through the ‘advice gap’ following industry regulation”, and that “some investors prefer not to have an upfront cost for financial advice – as this prices them out of the advice market. Investors with a portfolio of £10,000 for example would understandably be unwilling to hand over a tenth of their assets for an initial consultation cost – whereas the old advice model which took out of the profits along the way would be easier to swallow”. Even regulators have admitted that there is a growing advice gap. According to a September 10, 2013 Financial Times report, “FCA chief executive Martin Wheatley has admitted ‘concern’ over the post-RDR advice gap”. According to Wheatly “it is a concern that people with portfolios below £50,000 to £100,000 are not getting the same service they were getting…most advisers have worked out you can’t provide a fully advised service without five or six hours work and that costs money. Therefore we are seeing less of that model but we are seeing more web-based, entrepreneurial models delivering advice in a different form.” In fact, automated ‘web-based’ advice is being aggressively pushed by the UK regulator, though it is likely not a good substitute for face-to-face advice or for “five or six hours of work” by an investment professional.

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Though seemingly upbeat in it’s assessment, in a recent post-RDR review, the UK’s Financial Conduct Authority concluded that “by revealing the true cost of advice, the RDR has led some consumers to consider the extent to which the advice they receive represents value for money, and in some cases conclude it does not” (see: Financial Conduct Authority, “Post-Implementation Review of the Retail Distribution Review – Phase 1”, December 2014). A related analysis by the firm Europe Economics finds that “…advice can be seen as a credence good, with its fundamental quality difficult for the consumer to assess ex ante – or even ex post. This means that there is a scope for advisers to compete on measures which consumers believe are good proxies for quality, but which may not in fact be reliable indications of underlying quality”, and that “[f]irms are increasingly segmenting their consumers and considering the service they provide to different groups of consumers, with some focusing on services to those with higher levels of investible assets” (see: Europe Economics, “Retail Distribution Review: Post Implementation Review”, December 16, 2014). Several years ago the European Union Directorate General on Internal Markets and Services considered a ban on commissions in the insurance market. The EU asked the consulting firm PWC Luxembourg to conduct a study, part of which considered the impact of different solutions to conflicts of interest and remuneration.46 The study concluded that a ban on commissions could have a negative impact on consumers and would create an information gap. Due in part to that experience, a European standard setting group has declined to uniformly impose a ban on commissioned sales, and chose instead to leave the commission issue to each state. The Department acknowledges that comment letters on its 2010 proposal made a case that the initiative would result in diminished access to investment advice, particularly for low-balance savers, but appears unconcerned with this possibility, suggesting that ‘robo-advisers’ will fill any gaps that result from the proposed regulation. 47 However, robo-advisers are a new and untested method of providing financial advice and are not necessarily more cost-effective than in-person advice.48 At year-end 2014 robo-advisers managed only $19 billion in assets, compared to $24.7 trillion in total U.S. retirement assets, about 0.077% of the market or 77 cents out of every $1,000.49 There are no rigorous, refereed studies examining whether a robo-adviser is a good substitute for a human being. Numerous scholarly studies have shown, however, that there are clear positive effects from dealing with a human adviser, such as: encouragement to save more, less speculative trading, a more diversified portfolio, and greater discipline when faced with a volatile market. In fact, during financial downturns and market volatility, investors turn to human advisers for reassurance and are typically dissuaded from emotional investing. Because it is so recent, robo-advising has only been in existence during a bull market. It is unclear how this system would fare in a downturn. Depending on how many people utilize such a resource, there could be systemic implications which would be particularly devastating to retirees and pre-retirees, as well as the economy as a whole. As noted above, the proposed rule will significantly increase the costs and risks associated with selling and marketing to small employers (99 employees or less). Life insurers provide products and services to 31.8 million employer plan participants, about 35% of the entire market. About 60% of plan participants who work for a small employer (7.1 million employees) rely on life insurers for products and services.50 Virtually all small plan participants will be adversely impacted by the proposed rule. 46 PriceWaterhouseCoopers, Study on the Impact of the Revision of the Insurance Mediation Directive (ETD/2007/IM/B2/51): Final Report, Prepared for the European Commission DG Internal Market and Services, May 23, 2011. 47 See Regulatory Impact Analysis at p.109. 48 Fox, Justin, “Investing: Inside the Robo-Adviser Wars”, Bloomberg View, July 9, 2015. 49 This assumes that the entire $19 billion were retirement assets. It is likely that considerably less than $19 billion is in robo-adviser IRAs. See ICI and www.wsj.com/articles/putting-robo-advisers-to-the-test-1429887456 and http://www.forbes.com/sites/samanthasharf/2015/01/28/can-robo-advisers-survive-a-bear-market/. 50 Based on a 2015 ACLI survey of life insurers. Survey respondents represent 81% of industry assets.

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33. Insufficient analysis of direct costs.

The Department estimated that the cost of complying with the proposed rule would range from $2.4 billion to $5.7 billion over ten years, and assert that the higher end of the range is likely an overestimate. Shockingly, these estimates are based on two comment letters from trade associations (neither of which represent the life insurance industry), one of which is admittedly a rough estimate based on a survey of only 18 members and which was discounted by the Department because “the data appear to significantly overstate the cost of compliance”.51 Relying on two comment letters and entirely ignoring the implementation and compliance cost imposed on the life insurance industry to estimate the cost of significant new regulation on a $24.7 trillion industry is wholly insufficient. Further, the likelihood that a greater regulatory burden and new administrative and compliance costs would negatively affect positive innovation is not sufficiently considered in the initiative. Additionally, the cost-benefit analysis does not adequately consider the time needed to implement the changes required to comply with the proposed rule. According to a recent industry survey, on average, life insurers will require at least 24 months to fully implement changes necessary to comply with the proposed rule, with 20% of companies requiring at least 36 months.

4. The cost-benefit analysis does not consider annuities. One element of the Department’s regulatory impact analysis calculates the burden of fees and charges on the performance of selected investments. However, the Department’s analysis does not offer any direct evidence on the costs of conflict related to variable annuities, but rather applies academic studies on mutual fund costs to variable annuity products held in IRA accounts. In effect, because the Department presents no empirical analysis of any costs of conflicted advice for variable annuity products, the many cost estimates provided are not relevant to this sector of the market. The Department also does not consider the benefits of variable annuity products for IRA holders. Variable annuities are not simply investments, but rather insurance products which can ensure well-being and financial security for life. According to a 2013 Gallup survey, 87 percent of annuity owners intend to use their annuity as a financial cushion for living beyond their life expectancy.52 Variable annuities offer consumers a variety of insurance features, including the option of enhanced death benefits, accrual guarantees, and lifetime withdrawal benefits. Customers actively and voluntarily choose to elect various combinations of features tailored to their specific insurance needs and risk profiles. Survey data shows that annuity owners are pleased with the products they purchase. According to a recent LIMRA study, the vast majority of variable annuity owners are satisfied with their annuity, and five out of six deferred annuity owners would recommend an annuity to their family and friends.53 Additionally, a recent study by Towers Watson found that among retirees of similar wealth and health characteristics, those with annuitized incomes are happiest.54 Much like buying a house or choosing where to send your children to college, choosing the right annuity requires time, education, and guidance in order to make the right decision. The current Proposal may effectively eliminate or curtail these services. As is the case in any competitive market, the costs of the variable annuity products vary in relation to the number of features selected. Some consumers choose to pay more in order to have greater risk protection and insurance benefits. According to a recent, ongoing study which relies on a unique sample of contract-level variable annuity qualified account data from 13 life insurance

51 See DOL cost-benefit analysis p. 157 for details. 52 From: the Gallup Organization and Matthew Greenwald and Associates,, 2013 Survey of Owners of Individual Annuity Contracts (conducted for the Committee of Annuity Insurers). 53 LIMRA International, “LIMRA Secure Retirement Study: Knowledge of Annuities Boosts Ownership”, October 20, 2014. 54 Nyce, Steve; Quade, Billie Jean, “Annuities and Retirement Happiness”, Towers Watson Insider, September 2012.

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companies representing over 25% of the variable annuity industry, and which includes a representative sample of over 237,000 individual contracts, 40% variable annuity customers have chosen a living benefit, about one-third elected some form of enhanced death benefit, and 7% explicitly included an accumulation guarantee benefit which may guarantee growth rates or lock-in returns during the accumulation phase, before the owner chooses to annuitize.”55 Concerning surrender charges associated with insurance products like annuities, it appears that the Department presumes that: (1) all annuities have surrender charges; (2) all surrenders are for the full amount of the annuity; (3) annuity contracts never waive surrender charges in cases of hardship (such as serious illness or entering a nursing home); and, (4) surrender charges are applied 100% of the time. None of these presumptions are correct. In fact, if an annuity has a surrender charge it is contingent and incurs only if a contract is discontinued before the conclusion of the surrender period, which typically is about seven years. In order to offer guarantees, protection, and insurance features, insurer’s are required to set aside reserves and hold capital. Given the nature of how insurers are required to invest and the nature of guarantees they offer, it is reasonable to discourage withdrawals for a period of time. Thus, if an annuity has a surrender charge, and if the contract owner does not surrender the contract prematurely, surrender charges will not be incurred. In fact, very few contract holders pay surrender charges. Based on contract-level data collected from life insurers, a recent ongoing study has found that 17.8% of annuity contracts do not have surrender fees and that a large majority of companies offer at least some contracts with no surrender fees. Of those contracts which do have surrender fees, when a surrender or withdrawal occurs over 75% of annuity owners do not pay any surrender fees (i.e. the median surrender fee paid is 0%).56 Surrenders can be full, where the entire account is withdrawn, or partial, where only some portion of the account is withdrawn. Considering only partial surrenders, 81.7% paid no surrender fee. The average fee paid for all surrenders was 0.84% and for partial surrenders only 0.39%, 616 bps and 661 bps below the 7.00% the Department suggests is the norm. It is also important to note that, in the database referred to above, 100% of the firms that offer policies with surrender charges in the sample considered allowing contract holders to withdraw some percentage of their account balance each year with no fee. Additionally, in the sample, most firms that offer policies with surrender charges allow contract holders a contingency event waiver in the event of healthcare emergencies such as being checked into a nursing home. Additionally, allegations of ‘churning’ also appear to be unfounded. According to the study referred to above, less than 2% of contracts issued in 2012, 2013, 2014, or 2015 have been fully surrendered. These findings demonstrate that the Department’s assumptions regarding surrender charges are grossly overstated and inflate the Department’s conclusions.

CC. The Proposal unacceptably excludes the protections of the current regulatory framework from its quantification of need.

In its justification for the Proposal, Department asserts that current regulatory protections are inadequate to address Department’s concerns about advice to retirement plan participants. We disagree with the wholesale disregard of detailed systems of significant protection from the analysis of regulatory need. The scope of the Proposal can be responsibly tempered with an objective integration of these fundamental protections and prophylactics in the redesign of the Department Proposal. It is contrary to the guiding statutory, executive, and judicial standards to impose new and redundant elements governing advice to plan participants that are already served quite well under complementary patterns of significant regulation.

55 NERA study, forthcoming. 56 NERA study, forthcoming.

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A detailed regulatory framework governs conduct in the sale of insurance products. A brief synopsis about these requirements provides helpful background to the issues under study. Life insurance companies and their associated persons currently fulfill a broad array of regulation administered by state insurance departments, the Securities and Exchange Commission (SEC), the Department, the Financial Industry Regulatory Authority (FINRA), and various state securities departments. We offer input about this comprehensive regulatory framework to provide background for evaluating the benefits, needs and the costs of the Department Proposal. Business conduct standards regulate important aspects of the customer relationship, including suitability standards, disclosure, advertising, supervision, maintenance of customer account assets, data collection, training, compensation, and supervision of associated persons. In general, the federal securities laws and FINRA rules govern individual variable insurance contracts, and state insurance laws and regulations apply to fixed insurance products. In some cases, insurance products invoke both federal and state laws. Collectively, this body of regulatory provisions and oversight provide important consumer protection and strong enforcement tools. We have attached an Appendix to highlight the extensive network of laws and regulations governing insurance product sales activities. Laws and regulations most relevant include:

The NAIC Suitability in Annuity Transactions Model Regulation;

FINRA Rule 2330 governing suitability and supervision in the sale of variable annuities;

FINRA Rule 2320 governing non-cash compensation for variable products and mutual funds;

The NAIC Annuity Disclosure Model Regulation;

The NAIC Model Replacements Regulation, and state insurance regulations such as New York Regulation 60 which governs replacements;

The NAIC Unfair Trade Practices Act and the prohibition on “unfair financial planning practices;” and,

State insurance consulting laws governing the simultaneous receipt of product commissions and fees for insurance consulting services.

Life Insurers provide significant written disclosures at the point of sale to satisfy multiple regulators’ requirements and to help customers understand the nature of their various products and relationships. These disclosures include many product related materials (insurance sales illustrations, policy contracts, required “buyers guides,” prospectuses), marketing materials describing the firm’s offerings, documents that provide the terms for a brokerage or advisory relationship (brokerage account agreements, advisory account agreements, Form ADV, investment policy statements), and other required disclosures. There also is a considerable amount of post-sale disclosure depending on the nature of products and services provided, such as in-force insurance ledgers, transaction confirmations, periodic performance reporting for investment accounts, and updated Form ADV brochures. Several state and federal laws are designed to ensure appropriate sales practices and suitable recommendations consistent with customers’ financial objectives and best interests. Insurance products are the only products in today’s financial marketplace with free-look provisions extending for 10, or more, days. These features give consumers a meaningful opportunity to carefully evaluate purchases after the sale and to change their mind for any reason, including cost factors, to receive a refund.

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DD. The status of non-cash compensation regulation.

Discussion surrounding the Department Proposal has referenced inappropriate influences of non-cash compensation. Many of the observations reflect isolated circumstances and appear ignorant of significant constraints on non-cash compensation practices. A brief explanation about the standards governing non-cash compensation may illuminate objective analysis leading to more balanced revisions to the Proposal. Life insurers comply with regulations that regulate permitted non-cash compensation practices. FINRA Rule 2320 applies to broker-dealers selling variable insurance contracts and mutual funds, respectively, and limit non-cash compensation to: (1) gifts of up to $100 per associated person annually; (2) an occasional meal, ticket to a sporting event or theater, or comparable entertainment; (3) payment or reimbursement for training and education meetings held by broker-dealers or issuers/sponsors for the purpose of educating associated persons of broker-dealers, so long as certain conditions are met; (4) in-house sales incentive programs of broker-dealers for their own associated persons; and, (5) contributions by any company or other FINRA member to a broker-dealer’s permissible in-house sales incentive program, subject to the following explicit conditions:

Non-cash compensation arrangements between a broker-dealer and its associated persons or a company and its sales personnel who are associated persons of an affiliated member, are conditioned on (1) the member's or non-member's non-cash compensation arrangement, if it includes variable contract securities, is based on the total production of associated persons with respect to all variable contract securities distributed by the member; (2) the non-cash compensation arrangement requires that the credit received for each variable contract security is equally weighted; (3) no unaffiliated non-member company or other unaffiliated member directly or indirectly participates in the member's or non-member's organization of a permissible non-cash compensation arrangement; and (4) the record keeping requirement in the rule is satisfied. With regard to training and education meetings, the rule imposes strict additional conditions that require associated persons to obtain their broker-dealers’ prior approval to attend the meeting and that (1) attendance by a member’s associated persons is not conditioned by the broker-dealer on the achievement of a sales target or any other incentives pursuant to a non-cash compensation arrangement permitted by the rule; (2) the location is appropriate to the purpose of the meeting, which shall mean an office of the offeror or the broker-dealer, or a facility located in the vicinity of such office, or a regional location with respect to regional meetings; (3) the payment or reimbursement is not applied to the expenses of guests of the associated person; and, (4) the payment or reimbursement by the offeror is not conditioned by the offeror on the achievement of a sales target or any other non-cash compensation arrangement allowed under the rule. These limitations successfully assure that training and education meetings are appropriate.

Rule 2320 requires broker-dealers to maintain records of all non-cash compensation received by the broker-dealer or its associated persons in permitted non-cash compensation arrangements. The records must include: the names of the offerors, companies or other broker-dealers making the non-cash compensation contributions; the names of the associated persons participating in the arrangements; the nature and value of non-cash compensation received; the location of training and education meetings; and any other information that proves compliance by the broker-dealer and its associated persons with the rule.

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Life insurers support the spirit and purpose of Rule 2320, and actively participated in its development through comment letters and constructive suggestions to achieve an effective, consumer-protective regulation.57 ACLI regularly compiles and digests all FINRA disciplinary actions to capture data involving the distribution of variable products and broker-dealers affiliated with life insurance companies. In a survey of the past five years, there have been no reported disciplinary actions involving non-cash compensation associated with insurance product sales. These results demonstrate that FINRA Rule 2320 works efficiently and effectively.

EE. Commissions compared to fee-only investment advice.

The Proposal is founded on a premise that commissioned products influence advisers to provide conflicted advice to the detriment of retirement plan participants. As such, the Proposal elevates fee-based advice and automated robo-advice systems as preferable alternatives because they are cheaper and aligned with the interests of retirement plan participants. These premises are incorrect in many cases. Recommendations under the Proposal may generate the least expensive product that may actually disserve and impair the participant’s best interests. While fee-based or automated advice is appropriate for some individuals, it is not necessarily appropriate for all. In truth, financial product recommendations and associated compensation arrangements are most objectively evaluated according to the unique facts and needs of each financial customer and the individual compensation arrangement. Financial advisers who obtain their compensation through annual fees based on assets under management (“wrap fees”) would not likely recommend certain commission-based products, like annuities, because that purchase is not generally included within the assets under management on which the annual, recurrent fees are assessed by this type of fee-based financial adviser. Recurrent annual fees may be ill-suited to individuals with moderate assets needing little annual advice, and may exceed the total value of a commissioned-based adviser. FINRA issued guidance about fee-based arrangements, recognizing that while fee-based programs are beneficial for some customers, “they are not appropriate in all circumstances.”58 FINRA instructs that

Firms must consider the overall needs and objectives of the customer when determining the benefits of a fee-based account for that customer, including the anticipated level of trading activity in the account and non-price factors such as the importance that a customer places on

57 In a similar regulatory vein, New York Insurance Code Section 4228 permits certain non-cash compensation practices for life insurance policies and annuities. New York Insurance Code Section 4228(e)(6) provides that:

A company, including any person, firm or corporation on its behalf or under any agreement with it, may pay or award, or permit to be paid or awarded, prizes and awards to agents and brokers pursuant to a plan of agent or broker compensation, provided that no single prize or award may exceed a value of two hundred fifty dollars, and that the total value of such prizes and awards paid or awarded to any agent or broker within a calendar year may not exceed one thousand dollars. Notwithstanding the foregoing, a company may also pay or award not more frequently than monthly a prize or award valued at not more than twenty-five dollars.

An implementing regulation places monetary limits on the value of prizes and awards that insurers can provide agents. The records must include: the names of the offerors, companies or other broker-dealers making the non-cash compensation contributions; the names of the associated persons participating in the arrangements; the nature and value of non-cash compensation received; the location of training and education meetings; and any other information that proves compliance by the broker-dealer and its associated persons with the rule. The New York Department of Financial Services website contains additional information about what steps life insurers must take to comply with Section 4228. http://www.dfs.ny.gov/insurance/life/agcomp/life4228.htm 58 See Notice to Members 03-68, Fee-Based Compensation-NASD Reminds Members That Fee-Based Compensation Programs Must Be Appropriate, http://www.finra.org/sites/default/files/NoticeDocument/p003079.pdf .

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aligning his or her interests with the broker. Additionally, firms must take into account the nature of the services provided, the benefits of other available fee structures, and the customer's fee structure preferences.59

As FINRA aptly observes, under some customer circumstances, compensation through commission arrangements may be more appropriate than fee-based arrangements. Quite correctly, FINRA explained that the appropriateness of fee-only financial arrangements should be evaluated on the unique circumstances of each customer and their financial needs. The same is true with evaluations of commissioned recommendations to purchase certain financial products like annuities.60 There are many customers for whom annuities provide a valuable and appropriate means to achieving retirement security and guaranteed lifetime income. The fact that the salesperson was compensated by commissions does not diminish the important role annuities play in financial and retirement security. Commission-based compensation can be the most economical and appropriate form of compensation in advisory arrangements with consumers owning moderate amounts of retirement assets, and may be significantly less expensive than non-commissioned forms of compensation, such as asset management fees. For all of these reasons, the Proposal’s recurrent conviction that commission-based advice is always conflicted fails to fulfill the statutory, executive, and judicial mandates that the cost-benefit analysis should be balanced, and consider several solutions to proposed rulemaking.

FF. Correcting observations of fact and law. To ensure that agencies properly perform cost-benefit analysis and select the most cost-effective regulatory options, the White House Office of Information and Regulatory Affairs (OIRA) reviews agency cost-benefit analysis before proposed regulations become effective. To the extent views from that office reflect the January 15, 2015, White House Memorandum and the White House Fact Sheet61 supporting the Department of Labor’s proposed fiduciary rule, we offer some corrections of fact and law that may be helpful in the Proposal’s cost-benefit analysis. According to the memorandum “many firms recommend that prospective customers roll over 401(K) plan assets into an IRA without any knowledge of a customer’s financial situation.” Salespersons recommending the purchase of a variable annuity on an IRA roll over must fulfill FINRA’s suitability and supervision Rule 2330, which requires the salesperson to obtain specific information from the customer (such as the customer’s investment objectives, liquid net worth, financial sophistication, and tax status). This information is recorded on a customer account record that forms the basis of suitability determinations and supervisory review. Further, Rule 2330 requires the salesperson to make an 59 See Fee-Based Questions and Answers, http://www.finra.org/industry/fee-based-account-questions-answers . FINRA stated that

Certain potential problems have been identified through our examination program. For example, it is not always clear that customers receive adequate disclosure about the distinctions and features of fee-based versus commission-based accounts, including the differences in fee structures and that fees will probably be higher in a fee-based account if the level of activity is modest. Training and education at some firms are minimal, particularly in giving brokers guidance on how to evaluate whether a customer is appropriate for a fee-based account.

60 Elisse B. Walter, who served as acting SEC chair, SEC Commissioner, and FINRA Senior Executive Vice President, noted: In a nutshell, while fee based accounts can be a good thing, they are not always the right thing, or the best thing. We need you to look at each customer and determine what kind of fee works best for him or her. The Tully Report itself recognized that investors with low trading activity would probably be better off with a commission-based program that charges only when trades are made. See Elisse Walter, Current NASD Regulatory Issues on Sales and Marketing (Sept. 28, 2004) http://www.finra.org/newsroom/speeches/092804-remarks-27th-annual-sia-sales-and-marketing-conference.

61 The Fact Sheet is entitled Middle Class Economics: Strengthening Retirement Security by Cracking Down on Backdoor Payments and hidden Fees and was released February 23, 2015 .

54

affirmative determination that the “customer would benefit from certain features of a deferred variable annuity (e.g., tax-deferred growth, annuitization or death benefit.”

Rule 2330 imposes a significant supervisory obligation requiring the broker-dealer’s registered principal to review the recommendation and consider the extent to which:

the customer would benefit from certain features of a deferred variable annuity; the customer’s age or liquidity needs make the investment inappropriate; and, the customer involved an exchange of a deferred variable annuity: will incur surrender charges, face a new surrender period, lose death or existing benefits, have increased mortality and expense fees, appears to have a need for any potential product enhancements and improvements, or had another deferred variable annuity exchange within the preceding 36 months.

Likewise, the NAIC Suitability in Annuity Transactions Regulation imposes suitability and supervision standards for fixed annuity sales that are modeled on FINRA Rule 2330. This model regulation has been adopted in most jurisdictions. It is factually incorrect, therefore, that recommendations to purchase a fixed or variable annuity in an IRA roll over are done “without any knowledge of the customer’s financial situation.” The memorandum states that “advisers steer investors into variable annuities and other complex products with high fees. Advisers can exploit their customer’s low level of financial literacy by recommending riskier and more complex investments.” (emphasis added). Most, but not all, contemporary fixed and variable annuities have surrender fees, which only occur if the customer cancels the contract within a specified period, usually about seven years on average. Annuities are purchased and sold as long-term accumulation vehicles for retirement security, not as short-term trading vehicles. If customers purchase the contract and hold it for the surrender period, they will not incur surrender charges. The White House memorandum does not appear to understand these mechanics. As explained above, FINRA Rule 2330 and the NAIC Suitability in Annuity Transactions Model Regulation impose suitability and supervision standards that are designed to ensure that annuity purchases are appropriate for customers, including those with low levels of financial literacy. Variable annuities provide permanent annuity purchase rate guarantees for purchasers upon annuitization, and many variable annuities provide optional riders for guaranteed benefits, such as lifetime payouts, withdrawals and death benefits. Variable annuities are designed to track the growth in the economy and provide protection against lower purchasing power due to inflation. The White House statement overlooks the fact that variable annuities can provide a valuable solution to the risk that consumers will have inadequate retirement assets. The memorandum’s statements associating variable annuity recommendations with high fees, exploitation of low financial literacy and riskier investments is generally incorrect. The memorandum states that “consumer protections for investment advice in the retail and small plan markets are inadequate.” This unqualified observation is overbroad and ignores substantial consumer protections under the federal securities laws governing the activities of investment advisers and broker-dealers. Likewise, it ignores analogous protections under state laws such as the NAIC Suitability in Annuities Transactions Model Regulation. A fiduciary duty is currently enforced under the Investment Advisers Act for registered investment advisers that may be involved in recommendations about IRA roll over options. SEC Commissioner Daniel Gallagher addressed this observation in a recent public speech, noting that the memorandum’s statement

55

is not accompanied by any analysis or study of the current protections consumers receive from the regulatory oversight of brokers and investment advisers by the SEC and SROs-in fact, it blatantly ignores this comprehensive regulatory oversight. Indeed, the memo manages to avoid any mention of either the SEC or FINRA.62

The statement in the memorandum disregards other significant regulatory protections that currently exist under the federal securities laws. The Fact Sheet references “outdated regulations” that provide consumer protections under IRA roll over recommendations. FINRA Rule 2330 and the NAIC Suitability in Annuities Regulation were recently adopted to significantly upgrade consumer protections in fixed and variable annuity sales. The memorandum states that “loads encourage advisers to excessively churn their customers’ investments.” FINRA and SEC regulations explicitly prohibit churning of customer accounts. Indeed, FINRA Rule 2330 requires the adviser and supervisor to specifically consider whether a customer involved an exchange of a deferred variable annuity:

will incur surrender charges, face a new surrender period, lose death or existing benefits, have increased mortality and expense fees, appears to have a need for any potential product enhancements and improvements, or had another deferred variable annuity exchange within the preceding 36 months.

In response to this assertion in the memorandum, SEC Commissioner Gallagher noted “our (SEC) rules expressly prohibit brokers from churning customer accounts, and the SEC and SROS have sophisticated tools designed to monitor for such activity.”63 Likewise, the NAIC Suitability in Annuities Transaction demands that recommendations, and accompanying supervision, are suitable. Churning would not be suitable.

G. Concluding observations about the Proposal’s fulfillment of executive, statutory and judicial standards governing cost-benefit analyses in rulemaking.

Our submission provides numerous suggestions that will more appropriately align the Proposal with the Department’s mission and the Proposal’s purpose in a manner that respects the proper balance of costs and benefits while also protecting retirement plan participants. Our suggestions achieve a constructive improvement to the original proposal and help the Department forestall post-adoption challenges to the adequacy of its cost-benefit analysis as required under executive, statutory and judicial standards. The Proposal is exposed to judicial challenge because it:

Fails to calculate the impairment to small retirement plans through the loss of advisory channels, as required under the Regulatory Flexibility Act; Presents inflexible approaches that are arbitrary and capricious under APA standards and bypassing less burdensome alternatives on a cost-benefit yardstick; Neglects the judicial precedent in the trio of recent cases rejecting SEC rulemaking due to defective cost-benefit analysis; Rejects or ignores the comprehensive pattern of regulation that imposes significant protections against conflicts of interest and erects prophylactics to protect retirement plan participants; and

62 See Remarks at The SEC Speaks by Daniel M. Gallagher (Feb. 20, 2015) at 3. 63 See Remarks at The SEC Speaks by Daniel M. Gallagher (Feb. 20, 2015) at 3.

56

Ignores the impact of the rule on small businesses as required under the Regulatory Flexibility Act.

The Proposal’s exposure to post-adoption legal challenges can be mitigated by incorporating our recommended modifications. In the end, the Proposal should fully evidence the 2011 Executive Order issued by President Obama and the spirit of his comments, which emphasized:

“Sometimes, rules have gotten out of balance, placing unreasonable burdens on business—burdens that have stifled innovation;”64 “As the executive order I am signing makes clear, we are seeking more affordable, less intrusive means to achieve the same ends—giving careful consideration to benefits and costs. This means writing rules with more input from experts, businesses and ordinary citizens. It means using disclosure as a tool to inform consumers of their choices, rather than restricting those choices;”65 and, “We're looking at the system as a whole to make sure we avoid excessive, inconsistent and redundant regulation. And finally, today I am directing federal agencies to do more to account for—and reduce—the burdens regulations may place on small businesses.”66

******

On behalf of the ACLI member companies, thank you for consideration of these comments. We welcome the opportunity to discuss these comments and engage in a productive dialogue with the Department on this Proposal.

Respectfully,

James H. Szostek

64 Op-Ed, President Barack Obama, Toward a 21st Century Regulatory System, Wall Street Journal (Jan. 18, 2011). The President’s Op-Ed coincided with his issuance of Executive Order 13,563, which set strict standards for cost-benefit analysis in federal agency rulemaking. 65 Id. 66 Id.

Table of Contents for Appendix to ACLI Submission to the Department of Labor on the Fiduciary Rule

FINRA Rule 2330: Suitability and Supervision in the Sale of Variable Annuity Contracts...1

NAIC Suitability in Annuity Transactions Model Regulation: A Coordinated Approach to Suitability and Supervision in the Sale of Individual Annuity Contracts………………..…....8

ACLI Issues Status Chart: NAIC Annuity Disclosure, Suitability in Annuity Transactions & Senior Specific Certifications Model Regulations…………………………………………….. .15

State Laws Governing Suitability in Variable Life Insurance Sales……..……………………53

The NAIC Annuity Disclosure Model Regulation: Disclosure Standards in Annuity Distribution…………………………………………………………………………………………..…59

NAIC Buyer’s Guide for Deferred Annuities………………………………………………………64

NAIC Buyer’s Guide for Fixed Deferred Annuities with Appendix for Equity-Indexed Annuities………………………………………………………………………………………………...75

NAIC Insurance and Annuities Replacement Model Regulation………………………….…104

ACLI Law Survey: Replacement of Life and Insurance and Annuities……………………..119

NAIC Model Regulation on the Use of Senior-Specific Certifications and Professional Designations in the Sale of Life Insurance and Annuities……………………………………168

The Impact of State Insurance Consulting Laws on Producers Performing Financial Planning Services……………………………………………………………………………………171

A Comprehensive System of State Regulations Governs the Distribution of Insurance and Annuity Contracts………………………………………………………………………………196

ACLI Law Survey: Free Look/Right to Return Requirements………………………………..203

Recommendation Requirements.

has been informed of, in a general fashion,

Page 1 of Appendix

would benefit from

as a whole

documented and signed

reasonable efforts

Supervisory Review.

Page 2 of Appendix

Supervisory Procedures.

Training.

Automated Supervisory Review

Tax Qualified Plans.

Page 3 of Appendix

prior

no later than seven business daysafter the customer signs the application

two business days followingtransmits a customer’s application

five business days from the transmittal date

Page 4 of Appendix

3.

has a reasonable basis to believe

Page 5 of Appendix

“Undue concentration” standard eliminated.

in general terms

Page 6 of Appendix

uniquecertain

every

Page 7 of Appendix

Page 8 of Appendix

fixed annuity or variable annuity individually solicited

Page 9 of Appendix

Page 10 of Appendix

Page 11 of Appendix

obtain a certification

Page 12 of Appendix

Page 13 of Appendix

Page 14 of Appendix

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Sui

tabi

lity

Mod

el.

ALA

SK

A

Reg

. 3

AAC 2

6.77

0+

X

Reg

. Ef

fect

ive:

10/

16/1

1

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Ado

pted

Reg

ulat

ion

3 AAC

26

.750

+

X

Ef

fect

ive

July

25,

200

8

Not

ice

Of Pr

opos

ed

Cha

nges

In

The

Reg

ulat

ions

Of

The

Div

isio

n O

f In

sura

nce

X

Th

e In

sura

nce

Div

isio

n ha

s pu

blis

hed

a N

otic

e of

pro

pose

d ne

w r

ules

re

latin

g to

the

use

of se

nior

-spe

cific

cer

tific

atio

ns a

nd p

rofe

ssio

nal

desi

gnat

ions

in c

onne

ctio

n w

ith a

sol

icita

tion,

sal

e or

pur

chas

e of

, or

ad

vice

mad

e in

con

nect

ion

with

a li

fe in

sura

nce

or a

nnui

ty c

ontr

act

by a

n in

sura

nce

prod

ucer

.

Reg

. 3

AAC 2

6.82

0+

X

Effe

ctiv

e: 6

/28/

09

Esta

blis

hes

stan

dard

s an

d re

quirem

ents

for

the

use

of se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

so

licita

tion,

sal

e, p

urch

ase,

or

advi

ce m

ade

in c

onne

ctio

n w

ith a

life

in

sura

nce

or a

n an

nuity

con

trac

t by

an

insu

ranc

e pr

oduc

er. Th

e ru

les

subs

tant

ivel

y fo

llow

the

NAIC

mod

el r

egul

atio

n, e

xcep

t th

e ru

les

use

the

term

ann

uity

“pr

oduc

t” in

stea

d of

“co

ntra

ct”,

incl

udes

a

non-

mod

el p

rovi

sion

in 3

AAC

26.

825(

a)(2

) ad

ding

“or

al

stat

emen

ts o

r re

pres

enta

tion”

, an

d om

its N

AIC M

odel

lang

uage

, “T

here

is a

reb

utta

ble

pres

umpt

ion”

, at

the

beg

inni

ng o

f 3

AAC

26.8

25(c

).

Pag

e 17

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

4 o

f 38

pag

es

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

AR

KA

NS

AS

AR A

DC I

NS

82

X

Effe

ctiv

e: 7

/15/

09

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Rul

e 96

X

Effe

ctiv

e: 7

/15/

09

Esta

blis

hes

stan

dard

s an

d re

quirem

ents

for

the

use

of se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns b

y an

insu

ranc

e pr

oduc

er in

the

sal

e of

life

insu

ranc

e an

d an

nuiti

es.

Rul

e 98

X

Ef

fect

ive:

7/1

5/09

Th

e ne

w a

nnui

ty d

iscl

osur

e ru

le b

y an

d la

rge

adhe

res

to t

he N

AIC

mod

el. It

dev

iate

s fr

om t

he m

odel

in t

hat

it ad

ds a

pro

visi

on t

o th

e di

sclo

sure

doc

umen

t an

d bu

yer’s

guid

e st

anda

rds

stat

ing

that

di

sclo

sure

sta

tem

ents

mus

t be

sig

ned

and

date

d by

the

insu

ranc

e pr

oduc

er a

nd m

aint

aine

d by

the

pro

duce

r an

d is

suin

g co

mpa

ny for

fiv

e ye

ars.

And

, as

in t

he r

evis

ed v

ersi

on o

f th

e ru

le, th

e sc

ope

now

in

corp

orat

es p

re-n

eed

polic

ies.

AR

IZO

NA

Rev

. Sta

t. A

nn. §§

20-

1243

+

X

Enac

ted

2006

. (H

B 2

162)

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Rev

. Sta

t. A

nn. §§

20-

1242

+

X

En

acte

d 20

03.

Adm

in.

Com

p. R

20-6

-21

2.01

X

Ado

pted

200

4.

CA

LIFO

RN

IA

CA I

ns. §1

0509

.911

X

Sig

ned

by G

over

nor:

9/

20/1

1

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 18

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

5 o

f 38

pag

es

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Dep

t. o

f In

sura

nce

Not

ice

Dat

ed:

12/6

/11

Not

ice

to li

cens

ed in

sure

rs c

larifie

s Cal

iforn

ia D

epar

tmen

t of

In

sura

nce

annu

ity t

rain

ing

requ

irem

ents

. In

sura

nce

prod

ucer

s sh

all

not

solic

it th

e sa

le o

f an

ann

uity

pro

duct

unl

ess

the

prod

ucer

has

ad

equa

te k

now

ledg

e of

the

pro

duct

to

reco

mm

end

the

annu

ity a

nd

the

insu

ranc

e pr

oduc

er is

in c

ompl

ianc

e w

ith t

he in

sure

r’s

stan

dard

s fo

r pr

oduc

t tr

aini

ng.

The

hour

s of

tra

inin

g ne

eded

bef

ore

solic

iting

co

nsum

ers

to s

ell a

nnui

ties

and

hour

s of

tra

inin

g ne

eded

for

lice

nse

rene

wal

are

als

o ou

tline

d in

the

not

ice.

The

new

req

uire

men

ts

beco

me

effe

ctiv

e Ja

nuar

y 1,

201

2.

CO

LOR

AD

O

Reg

. 4-

1-12

X

Ef

fect

ive:

06/

01/1

4 Th

e am

endm

ents

to

the

annu

ity d

iscl

osur

e re

gula

tion

incl

ude,

but

ar

e no

t lim

ited

to,

addi

ng a

new

sec

tion

on s

tand

ards

for

ann

uity

ill

ustr

atio

ns,

expa

ndin

g th

e de

finiti

ons

sect

ion,

and

upd

atin

g th

e en

forc

emen

t, s

ever

abili

ty a

nd in

corp

orat

ed m

ater

ials

sec

tions

, as

w

ell a

s ad

ding

an

annu

ity il

lust

ratio

n ex

ampl

e.

Reg

. 4-

1-2

X

Ef

fect

ive:

07/

01/1

4 Th

e am

endm

ents

to

the

rule

on

adve

rtis

ing

and

sale

s of

life

in

sura

nce

and

annu

ities

incl

ude,

in a

dditi

on t

o te

chni

cal c

hang

es,

addi

ng n

ew d

iscl

osur

e re

quirem

ents

and

del

etin

g th

e se

ctio

n on

co

nflic

t w

ith o

ther

law

s or

reg

ulat

ions

.

Bul

letin

B-4

.67

X

D

ated

: 1/

14/1

4 Th

is b

ulle

tin in

form

s in

sure

rs t

hat

the

NAI

C h

as r

evis

ed it

s Buy

er’s

G

uide

to

Fixe

d D

efer

red

Ann

uitie

s an

d th

at t

he s

tate

pla

ns t

o re

vise

its

reg

ulat

ion

conc

erni

ng r

equi

rem

ents

for

ann

uity

tra

nsac

tions

to

refe

r to

the

201

3 N

AIC

Buy

er’s

Gui

de for

Def

erre

d Ann

uitie

s. I

t al

so

urge

s in

sure

rs t

o ex

amin

e th

e re

vise

d bu

yer’

s gu

ide

and

mak

e an

y es

sent

ial c

hang

es t

o pr

eser

ve c

ompl

ianc

e w

ith C

olor

ado

insu

ranc

e re

gula

tions

.

3 CO

AD

C I

NS

702-

4:4-

1-11

X

Effe

ctiv

e: 8

/1/1

1 Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Reg

. 4-

1-12

ACLI

Com

men

t Le

tter

on

prop

osed

am

endm

ents

X

Ef

fect

ive

1/1/

07.

Offer

s cr

iteria

for

the

disc

losu

re o

f sp

ecifi

ed d

ata

abou

t an

nuity

co

ntra

cts

to m

ake

cert

ain

that

pur

chas

ers

com

preh

end

esse

ntia

l as

pect

s of

the

con

trac

ts.

Re-

prop

osed

to

chan

ge s

ectio

ns in

clud

ing

requ

irin

g a

free

look

pe

riod

of

at le

ast

15 d

ays

at o

r pr

ior

to t

he t

ime

of a

pplic

atio

n in

the

ab

senc

e of

a B

uyer

’s G

uide

and

a d

iscl

osur

e do

cum

ent

and

havi

ng

the

reg.

app

ly t

o co

ntra

cts

sold

on

or a

fter

1/1

/07,

the

sam

e da

y th

e am

ende

d re

g. b

ecom

es e

ffec

tive.

ACLI

sub

mitt

ed a

com

men

t le

tter

on

the

prop

osed

am

endm

ents

to

Reg

ulat

ion

4-1-

12.

The

prop

osed

am

endm

ents

wou

ld a

dopt

the

la

test

upd

ates

to

the

NAIC

Ann

uity

Dis

clos

ure

Mod

el R

egul

atio

n.

Pag

e 19

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

6 o

f 38

pag

es

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

ACLI

’s le

tter

foc

uses

on

one

port

ion

of t

he p

ropo

sed

amen

dmen

ts

whi

ch t

he N

AIC

has

indi

cate

d st

ates

sho

uld

cons

ider

om

ittin

g.

ACLI

’s le

tter

urg

es o

mis

sion

of

the

lang

uage

.

Reg

. 1-

2-18

X

Effe

ctiv

e: 6

/1/0

9 Es

tabl

ishe

s st

anda

rds

and

requ

irem

ents

for

the

use

of se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

so

licita

tion,

rec

omm

enda

tion,

sal

e or

acq

uisi

tion

of li

fe in

sura

nce

and

annu

ity p

rodu

cts.

CO

NN

ECTI

CU

T

H.

6772

X

Intr

oduc

ed F

ebru

ary

11, 20

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Wou

ld r

equi

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to

pro

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dis

clos

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empl

oyee

s an

d re

tiree

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an

empl

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w

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the

com

pany

issu

es a

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up a

nnui

ty c

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rovi

de

retir

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nefit

s. W

ould

pro

tect

am

ount

s pa

yabl

e un

der

the

issu

ed a

nnui

ty c

ontr

act

from

cre

dito

rs o

f pa

rtic

ipan

ts a

nd

bene

ficia

ries

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sed

Hou

se o

n A

pri

l 22

, 2

01

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To S

enat

e fo

r co

nsi

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atio

n.

Wou

ld p

lace

res

tric

tio

ns

and

dis

clo

sure

s o

n

pen

sion

der

iski

ng

tra

nsa

ctio

ns.

Sec

tion

1,

wh

ich

has

now

b

een

del

eted

, co

nta

ined

on

ero

us

limit

atio

ns

on

th

ese

tran

sact

ion

s: p

rovi

din

g a

disc

losu

re t

o b

enef

icia

ries

sta

tin

g

that

th

ey w

ill n

o lo

ng

er h

ave

ERIS

A p

rote

ctio

n;

pro

vid

ing

det

aile

d a

nn

ual

sta

tem

ent

fro

m t

he

insu

rer

reg

ard

ing

ass

ets;

an

d th

e lim

itat

ion

th

at d

eris

kin

g t

ran

sact

ion

s m

ust

be

app

rove

d b

y th

e co

mm

issi

oner

. S

ecti

on 2

of

the

bill

, w

hic

h is

al

l th

at n

ow r

emai

ns,

wo

uld

pro

tect

an

nu

ity

pro

ceed

s fr

om

cr

edit

ors.

Reg

.38a

-432

-1+

X

Reg

. Ef

fect

ive:

2/1

8/12

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Reg

. 38

a-43

2b-1

+

X

Effe

ctiv

e: 7

/7/2

010

Esta

blis

hes

stan

dard

s an

d re

quirem

ents

for

the

use

of se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

sal

e of

in

sura

nce,

incl

udin

g an

nuiti

es.

DEL

AW

AR

E

Reg

. 12

14

X

Ado

pted

200

5.

Sim

ilar

to t

he 2

003

NAIC

Sen

ior

Prot

ectio

n M

odel

.

Pag

e 20

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

7 o

f 38

pag

es

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

DIS

TRIC

T O

F C

OLU

MB

IA

DC M

un.

Reg

s. T

it. 2

6-A

§840

1 X

Reg

. Ef

fect

ive:

12/

24/1

0

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Rul

e 58

00+

X

Effe

ctiv

e: 7

/30/

10

Sub

stan

tially

sim

ilar

to N

AIC S

enio

r Sp

ecifi

c Cer

tific

atio

ns M

odel

.

FLO

RID

A

Rul

e 69

B-1

62.0

11

Not

ice

of C

orre

ctio

n U

pdat

e an

d Cla

rific

atio

n

X

Effe

ctiv

e: 1

0/21

/14

The

amen

dmen

ts m

odify

pro

visi

ons

on a

nnui

ty s

uita

bilit

y an

d di

sclo

sure

to

conf

orm

to

revi

sion

s en

acte

d by

SB 1

66 t

hat

revi

sed

cons

umer

pro

tect

ion

law

s re

latin

g to

the

sal

es o

f an

nuiti

es b

y in

corp

orat

ing

the

2010

NAI

C S

uita

bilit

y in

Ann

uity

Tra

nsac

tions

M

odel

Reg

ulat

ion.

The

y in

clud

e ex

tend

ing

prot

ectio

ns p

revi

ousl

y af

ford

ed o

nly

to s

enio

r co

nsum

ers

to c

onsu

mer

s of

any

age

, re

visi

ng

Form

s D

FS-H

1-19

80 a

nd D

FS-H

1-19

81 t

o re

flect

the

sta

ndar

ds,

proc

edur

es a

nd g

uide

lines

of th

e m

odel

reg

ulat

ion,

and

cha

ngin

g th

e tit

le t

o be

tter

ref

lect

the

pro

pose

d ru

le's

sco

pe.

* Am

endm

ents

to

Rul

e 69

B-1

62.0

11, re

latin

g to

sui

tabi

lity

and

disc

losu

re in

ann

uity

inve

stm

ents

wer

e ad

opte

d on

Oct

ober

1, 20

14.

The

form

s (D

iscl

osur

e an

d Com

pariso

n of

Ann

uity

Con

trac

ts a

nd

Ann

uity

Sui

tabi

lity

Que

stio

nnai

re)

inco

rpor

ated

in t

he r

ule

wer

e ad

opte

d as

wel

l. Th

e ru

le a

nd for

ms

will

bec

ome

effe

ctiv

e on

O

ctob

er 2

1, 2

014.

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

S.

166

ACLI

Com

men

t Le

tter

O

IR I

nfor

mat

iona

l M

emor

andu

m

X

Sig

ned

by g

over

nor:

6/

14/1

3 Ef

fect

ive:

10/

1/13

Prov

ides

tha

t re

com

men

datio

ns r

elat

ing

to a

nnui

ties

mad

e by

an

insu

rer

or it

s ag

ents

app

ly t

o al

l con

sum

ers

not

just

to

seni

or

cons

umer

s. I

ncre

ases

the

per

iod

of t

ime

that

an

unco

nditi

onal

re

fund

mus

t re

mai

n av

aila

ble

with

res

pect

to

cert

ain

annu

ity

cont

ract

s. M

akes

suc

h un

cond

ition

al r

efun

ds a

vaila

ble

to a

ll pr

ospe

ctiv

e an

nuity

con

trac

t bu

yers

with

out

rega

rd t

o th

e bu

yer’

s ag

e; c

onsi

sten

t w

ith N

AIC m

odel

gui

danc

e; in

corp

orat

es F

lorida

co

nsum

er p

rote

ctio

ns;

requ

ired

sui

tabi

lity

and

com

pariso

n fo

rms,

co

ver

page

, lim

itatio

n on

def

erre

d sa

les

char

ges.

*

On

Aug

ust

6, A

CLI

sta

ff r

emitt

ed a

com

pila

tion

of m

embe

r co

mpa

ny in

quirie

s (P

DF)

reg

ardi

ng t

he im

plem

enta

tion

of S

. 16

6,

Sui

tabi

lity

in A

nnui

ties

Tran

sact

ions

, to

bot

h th

e D

epar

tmen

t of

Fi

nanc

ial S

ervi

ces,

Div

isio

n of

Age

nt a

nd A

genc

y Ser

vice

s an

d th

e O

ffic

e of

Ins

uran

ce R

egul

atio

n se

nior

sta

ff. AC

LI s

taff w

as a

dvis

ed

on A

ugus

t 26

tha

t re

gula

tory

lega

l sta

ff a

re s

till w

orki

ng o

n

Pag

e 21

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

8 o

f 38

pag

es

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

resp

onse

s w

hich

the

y w

ill p

rovi

de t

o ACLI

sta

ff a

s so

on a

s po

ssib

le.

On

Janu

ary

22, 20

14,

ACLI

sta

ff s

ough

t cl

arifi

catio

n fr

om

Dep

artm

ent

of F

inan

cial

Ser

vice

s, D

ivis

ion

of A

gent

and

Age

ncy

Ser

vice

s, o

n th

e ap

plic

abili

ty o

f th

e “F

INRA

Saf

e H

arbo

r” p

rovi

sion

.

S.

2176

X

Ef

fect

ive:

1/1

/11

Am

ong

othe

r th

ings

, re

quires

tha

t th

e bu

yer’

s gu

ide

for

fixed

an

nuiti

es b

e in

the

for

m p

rovi

ded

by t

he N

atio

nal A

ssoc

iatio

n of

In

sura

nce

Com

mis

sion

ers

Ann

uity

Dis

clos

ure

Mod

el R

egul

atio

n an

d au

thor

izes

the

use

of po

licy

sum

mar

y as

par

t of

pro

spec

tus

for

variab

le a

nnui

ties

until

the

NAI

C o

r th

e de

part

men

t de

velo

ps a

bu

yer’

s gu

ide

Prop

. Rul

e 69

B-2

15.2

35

X

Effe

ctiv

e: 1

1/16

/11

The

new

rul

e on

the

use

of de

sign

atio

ns c

larifie

s th

at t

he o

nly

lega

l de

sign

atio

ns t

hat

may

be

used

are

one

s pe

rmitt

ed b

y es

tabl

ishe

d or

gani

zatio

ns r

etai

ning

pub

lishe

d cr

iteria

and

prac

tices

gua

rant

eein

g th

e co

nsta

nt p

rofic

ienc

y an

d et

hica

l beh

avio

r of

mem

bers

or

conf

eree

s an

d fo

rbid

s th

e us

e of

sel

f-be

stow

ed o

r ba

sele

ss

desi

gnat

ions

.

Pag

e 22

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

9 o

f 38

pag

es

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Rul

e 69

B-1

62.0

11

Com

men

t Le

tter

X

X

Effe

ctiv

e: N

ovem

ber

15,

2009

* *S

uita

bilit

y Rul

e an

d Fo

rms

adop

ted

on O

ctob

er 2

7th a

nd

as p

ublis

hed

on F

lorida

Adm

inis

trat

ive

Wee

kly

web

site

and

FL

DFS

site

st

ipul

ates

an

effe

ctiv

e da

te

of N

ovem

ber

15. Th

is is

a

cler

ical

err

or o

n th

e pa

rt o

f Sec

reta

ry S

tate

’s o

ffic

e. T

he

stat

ute,

whi

ch c

ontr

ols,

pr

ovid

es a

n ef

fect

ive

date

of

Janu

ary

1, 2

009

or 6

0 da

ys

follo

win

g th

e ad

optio

n of

the

ru

le,

whi

ch w

ould

be

Dec

embe

r 25

th.

The

Join

t Adm

inis

trat

ive

Proc

edur

e Com

mitt

ee h

as a

dvis

ed F

L D

FS t

hat

the

effe

ctiv

e da

te

prov

ided

in t

he r

ule

is a

“n

ullit

y” a

nd s

houl

d be

di

sreg

arde

d. F

L D

FS is

co

nsid

erin

g a

Gen

eral

Bul

letin

to

this

effec

t.

Esta

blis

hes

the

dutie

s re

quired

of in

sure

rs a

nd in

sura

nce

prod

ucer

s in

the

sal

e of

ann

uity

con

trac

ts t

o se

nior

con

sum

ers,

incl

udin

g th

e pu

rcha

se, ex

chan

ge,

and

repl

acem

ent

of s

uch

cont

ract

s. A

lso

inco

rpor

ates

by

refe

renc

e an

ann

uity

sui

tabi

lity

ques

tionn

aire

and

an

ann

uity

con

trac

ts d

iscl

osur

e fo

rm.

S.

2082

Sig

ned

by G

over

nor:

6/

30/0

8.

Effe

ctiv

e up

on t

his

act

beco

min

g a

law

, D

epar

tmen

t of

Fin

anci

al

Ser

vice

s m

ay a

dopt

rul

es t

o im

plem

ent

this

act

. Sec

. 9

of t

his

act

and

such

impl

emen

ting

rule

s sh

all t

ake

effe

ct 6

0 da

ys a

fter

dat

e on

w

hich

the

fin

al r

ule

is a

dopt

ed o

r 1/

1/09

, w

hich

ever

is la

ter.

Pag

e 23

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

10

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Sta

t. §

626

.99

Enac

ted

1982

and

199

1.

Req

uire

s de

liver

y of

Ann

uity

Dis

clos

ure

Mod

el B

uyer

’s G

uide

.

GEO

RG

IA

Prop

osed

Rep

eal a

nd

Rea

dopt

ion

of R

egul

atio

n 12

0-2-

94-.

01+

X

Th

e pr

opos

ed a

men

dmen

ts w

ould

rep

eal t

he s

uita

bilit

y in

ann

uity

tr

ansa

ctio

ns r

egul

atio

n, r

eado

ptin

g it

to in

corp

orat

e th

e N

AIC's

mos

t re

cent

mod

el o

n su

itabi

lity

in a

nnui

ty t

rans

actio

ns.

ACLI

/IRI

tele

conf

eren

ce

with

DO

I st

aff

DO

I Com

men

ts

Reg

. 12

0-2-

73-.

05

ACLI

Com

men

ts

GA P

ropo

sed

Reg

. 12

0-2-

73-.

05

Bul

letin

15-

EX-1

X

Ef

fect

ive:

1/7

/14

Impl

emen

tatio

n D

ate:

3/

1/14

On

Frid

ay,

Janu

ary

30, ACLI

sta

ff a

nd I

nsur

ed R

etirem

ent

Inst

itute

(I

RI)

sta

ff h

oste

d a

tele

conf

eren

ce w

ith D

epar

tmen

t of

Ins

uran

ce

(DO

I) s

enio

r st

aff re

gard

ing

mem

ber

com

pany

con

cern

s w

ith t

he

rece

nt a

dopt

ion

of A

nnui

ty D

iscl

osur

e Reg

ulat

ion

12-2

-73.

The

new

ru

le,

effe

ctiv

e Ja

nuar

y 1,

201

5, p

rovi

ded

for

the

adop

tion

of t

he

rece

ntly

upd

ated

Nat

iona

l Ass

ocia

tion

of I

nsur

ance

Com

mis

sion

ers'

Ann

uitie

s Buy

er's

Gui

des

(Gui

de for

Fix

ed a

nd V

aria

ble,

Def

erre

d Fi

xed

& V

aria

ble

Onl

y).

As

part

of th

e de

part

men

t's a

dopt

ion

unde

r 12

0-2-

73, st

ruck

fro

m t

he s

cope

of th

e th

en e

xtan

t re

gula

tion

was

th

e ex

cept

ion

for

variab

le a

nnui

ties

sinc

e th

e ch

ange

to

the

regu

latio

n's

appe

ndix

inco

rpor

ated

the

var

iabl

e an

nuiti

es b

uyer

's

guid

e. U

nfor

tuna

tely

, w

ith t

hat

strike

of th

e ex

cept

ion,

the

re

gula

tion

now

oth

erw

ise

requ

ires

the

pro

visi

on o

f a

cons

umer

co

ntra

ct s

umm

ary,

a p

ublic

atio

n th

at d

oes

not

acco

mm

odat

e th

e va

riab

le s

pace

for

con

sum

er e

duca

tion

and

is n

ot r

equi

red

in a

ny

othe

r st

ate.

On

the

tele

conf

eren

ce,

base

d on

ACLI

and

IRI

inpu

t,

DO

I sa

id t

hat,

in t

he s

hort

ter

m,

they

are

look

ing

at d

evel

opin

g a

depa

rtm

ent

dire

ctiv

e to

pro

vide

tha

t a

pros

pect

us w

ill s

erve

as

a co

ntra

ct s

umm

ary

for

the

purp

ose

of c

ompl

ianc

e w

ith t

he

regu

latio

n. I

n th

e lo

ng t

erm

, th

ey w

ould

like

to

amen

d th

e cu

rren

t ru

le t

o re

flect

tha

t sa

me

polic

y, e

xem

ptin

g va

riab

le a

nnui

ty p

rodu

cts

from

the

con

trac

t su

mm

ary

requ

irem

ent.

Th

e am

endm

ents

rep

eal t

he B

uyer

’s G

uide

to

Ann

uitie

s, a

n ap

pend

ix t

o th

e re

gula

tion

on d

iscl

osur

e re

quirem

ents

, an

d ad

opt

a ne

w a

ppen

dix

that

inco

rpor

ates

an

upda

ted

NAI

C B

uyer

’s G

uide

to

Ann

uitie

s.

Insu

ranc

e D

epar

tmen

t to

cor

rect

ove

rsig

ht fro

m r

ecen

tly

prom

ulga

ted

amen

ded

Ann

uity

Buy

er’s

Gui

de r

egul

atio

n in

an

upco

min

g he

arin

g. D

epar

tmen

t ad

vise

s th

at c

ompa

nies

are

fre

e to

in

clud

e om

itted

lang

uage

in t

heir d

istr

ibut

ed g

uide

s in

the

inte

rim

.

Adm

in.

Com

p. c

h. 1

20-2

-73

Enac

ted

1996

. Var

iatio

n of

the

NAIC

Ann

uity

Dis

clos

ure

Mod

el.

Rul

e Ch.

120

-2-9

4 X

Ado

pted

200

6.

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 24

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

11

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

HA

WA

II

HI

Rev

. Sta

t. A

nn.

§431

:10D

-621

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

S.

2768

X

Sig

ned

by t

he G

over

nor:

4/

24/1

2 Ret

roac

tive

Effe

ctiv

e D

ate:

1/

1/12

Sec

tion

14 a

men

ds e

xist

ing

prod

ucer

tra

inin

g re

quirem

ents

pe

rtai

ning

to

annu

ity s

ales

, pu

rsua

nt t

o N

AIC M

odel

req

uire

men

ts.

* Aft

er w

orki

ng w

ith t

he I

nsur

ance

Div

isio

n fo

r w

ell o

ver

a ye

ar,

on

Aug

ust

19, 20

13, ACLI

and

oth

er in

sura

nce

indu

stry

rep

rese

ntat

ives

w

ere

able

to

reac

h an

agr

eem

ent

with

the

div

isio

n re

gard

ing

a lif

e in

sure

r’s

role

and

res

pons

ibili

ties

in v

erify

ing

a pr

oduc

er’s

co

mpl

ianc

e w

ith t

he a

nnui

ty t

rain

ing

requ

ired

by

S.

2768

, pa

ssed

by

Haw

aii’s

legi

slat

ure

in 2

012.

The

insu

ranc

e di

visi

on h

ad e

arlie

r an

noun

ced

that

it w

ould

be

amen

ding

its

prod

ucer

app

oint

men

t fo

rm (

Form

APP

T –

Rev

, 2/

16/2

012)

to

incl

ude

a fo

otno

te s

tatin

g th

at b

y si

gnin

g th

e fo

rm t

he li

fe in

sure

r ve

rifie

s th

at t

he a

ppoi

nted

pr

oduc

er h

as c

ompl

eted

the

tra

inin

g or

wou

ld c

ompl

ete

that

tra

inin

g “b

efor

e so

liciti

ng t

he s

ale

of a

nnui

ty p

rodu

cts”

. As

part

of th

e pa

rtie

s’ a

gree

men

t th

e in

sura

nce

divi

sion

agr

eed

to r

emov

e th

e fo

otno

te fro

m t

he for

m. A r

evis

ed “

Not

ice

of N

ew A

ppoi

ntm

ent”

for

m

has

now

bee

n po

sted

on

the

divi

sion

’s w

ebsi

te.

S.

1278

X

X

Sig

ned

by t

he G

over

nor:

6/

14/1

1

Ado

pts

both

the

NAI

C’s

Ann

uity

Sui

tabi

lity

and

Seni

or D

esig

natio

ns

Mod

els.

Rev

ised

Mem

oran

dum

201

1-2L

IC

Info

rms

insu

ranc

e pr

oduc

ers

that

the

Ins

uran

ce D

ivis

ion

will

re

cogn

ize

annu

ity t

rain

ing

com

plet

ed in

ano

ther

jur

isdi

ctio

n.

S.

1008

X

Sig

ned

by g

over

nor

7/5/

07.

Effe

ctiv

e 1/

1/08

. En

acts

the

NAI

C’s

Sui

tabi

lity

in A

nnui

ty T

rans

actio

n M

odel

Reg

ulat

ion.

Am

ends

“ge

nera

l age

nt”

to r

ead

“man

agin

g ge

nera

l ag

ent”

. Sp

ecifi

es a

pplic

abili

ty t

o an

insu

rer,

gen

eral

age

nt,

inde

pend

ent

agen

cies

, or

a p

rodu

cer

in t

erm

s of

the

pen

alty

bei

ng

redu

ced

or e

limin

ated

for

cor

rect

ive

actio

n of

a v

iola

tion.

Add

s “f

ailu

re t

o ob

tain

info

rmat

ion”

as

defin

ition

of un

fair m

etho

ds o

f co

mpe

titio

n an

d un

fair o

r de

cept

ive

acts

or

prac

tices

. Pr

ovid

es t

hat

noth

ing

in t

his

Act

sha

ll be

con

stru

ed t

o su

pers

ede

in a

ny m

anne

r an

y pr

ovis

ion

of t

he U

nifo

rm S

ecur

ities

Act

and

not

hing

sha

ll af

fect

righ

ts a

nd d

utie

s th

at m

atur

ed,

pena

lties

tha

t w

ere

incu

rred

, an

d pr

ocee

ding

s th

at w

ere

begu

n, b

efor

e th

e ac

t’s e

ffec

tive

date

.

Sta

t. §

431

:10D

-601

et

seq

.

X

En

acte

d 20

06 (

SB

2434

) Sim

ilar

to t

he N

AIC

Ann

uity

Dis

clos

ure

Mod

el.

Pag

e 25

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

12

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

IDA

HO

Bul

letin

13-

06

X

D

ated

: 12

/13/

13

This

bul

letin

info

rms

insu

rers

and

pro

duce

rs t

hat

they

may

sat

isfy

th

e bu

yer’s

guid

e st

atut

ory

requ

irem

ent

by p

rovi

ding

con

sum

ers

with

eith

er t

he N

AIC B

uyer

’s G

uide

to

Fixe

d D

efer

red

Ann

uitie

s w

ith

App

endi

x fo

r Eq

uity

-Ind

exed

Ann

uitie

s la

st r

evis

ed in

200

7 –

AN

BLE

(19

99, 20

07),

or

the

2013

NAI

C B

uyer

’s G

uide

for

Def

erre

d Ann

uitie

s –

Fixe

d –

AN

BLE

(20

13).

ID A

dmin

. Cod

e 18

.01.

09.0

01

X

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

S.

1327

X

Sig

ned

by G

over

nor:

4/8

/10

Effe

ctiv

e: 7

/1/1

0 Add

s s.

41-

1941

to

adop

t ke

y pr

ovis

ions

of th

e N

AIC

mod

el a

nnui

ty

disc

losu

re la

w a

nd a

llow

the

Direc

tor

to a

dopt

the

rem

aind

er o

f th

e m

odel

by

rule

. Th

e la

w c

onta

ins

two

variat

ions

fro

m t

he m

odel

: a

20-d

ay fre

e lo

ok p

rovi

sion

ref

lect

ing

curr

ent

law

, an

d a

prov

isio

n ad

ded

by t

he D

epar

tmen

t of

Ins

uran

ce t

hat

requ

ires

the

pro

duce

r an

d co

mpa

ny t

o ob

tain

a s

igne

d co

py o

f th

e di

sclo

sure

doc

umen

t fr

om t

he a

pplic

ant.

H.

411

X

Sig

ned

by G

over

nor:

3/

19/0

8.

Effe

ctiv

e: 7

/1/0

8.

Prop

osed

Reg

ulat

ion

text

:

ID P

rop

Reg

18.

01.0

9 Te

mpo

rary

Rul

e: I

D A

d Reg

Te

mpo

rary

18.

01.0

9

X

Com

men

ts b

y: 8

/27/

08

Effe

ctiv

e: 7

/1/0

8 Th

e pr

opos

ed a

men

dmen

ts t

o th

e an

nuity

sui

tabi

lity

rule

wou

ld

rem

ove

the

refe

renc

es t

o se

nior

s, m

akin

g it

pert

inen

t to

all

cons

umer

s.

Sta

t. §

41-

1940

X

Enac

ted

2005

. (H

B 1

17)

From

the

NAI

C S

enio

r Pr

otec

tion

Mod

el,

cont

ains

Sec

tion

6A-C

“D

utie

s of

Ins

urer

s an

d In

sura

nce

Prod

ucer

s.”

La

ngua

ge d

evia

tes

from

the

NAIC

mod

el in

sec

tion

addr

essi

ng

exem

pted

con

trac

ts.

Excl

udes

Sec

t. 6

D,

syst

em o

f su

perv

isio

n, a

nd

Sec

t. 6

E, c

ompl

ianc

e w

ith N

ASD

con

duct

rul

es.

App

lies

to c

onsu

mer

s ov

er 6

5.

Rul

e ID

APA

18.

01.0

9 X

Ado

pted

200

6.

Sim

ilar

to t

he N

AIC

Sen

ior

Prot

ectio

n M

odel

Reg

.

ILLI

NO

IS

Rul

e 31

20.0

1+

X

Reg

. Ef

fect

ive:

9/2

6/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 26

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

13

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Bul

letin

201

1-13

X

Dat

ed:

10/3

1/11

Bul

letin

cla

rifie

s w

hen

amen

dmen

ts t

o Rul

e 31

20 S

uita

bilit

y In

Ann

uity

Tra

nsac

tions

bec

ome

oper

ativ

e. T

he b

ulle

tin s

tate

s th

at

prod

ucer

s w

ho h

old

a lif

e in

sura

nce

line

of a

utho

rity

and

inte

nd s

ell

annu

ities

hav

e un

til J

uly

1, 2

012,

to

com

plet

e th

e tr

aini

ng

requ

irem

ents

. Th

e bu

lletin

als

o st

ates

tha

t in

sure

r su

perv

isor

y re

quirem

ents

con

tain

ed in

the

reg

ulat

ion

also

bec

ome

oper

ativ

e on

Ju

ly 1

, 20

12.

S.

1607

X

Sig

ned

by G

over

nor:

8/

23/1

1 Ef

fect

ive:

8/2

3/11

Ado

pts

the

NAI

C S

enio

r-Spe

cific

Cer

tific

atio

ns M

odel

.

Rul

e 13

0.85

5

X

Effe

ctiv

e: 9

/8/0

9 Th

e am

endm

ents

to

the

secu

ritie

s ru

le a

dd n

ew p

rovi

sion

s co

ncer

ning

the

tre

atm

ent

by f

inan

cial

adv

iser

s of

sen

ior

cert

ifica

tions

and

pro

fess

iona

l des

igna

tions

bas

ed o

n th

e N

ASAA

Mod

el.

IND

IAN

A

760

IAC 1

-79-

1 to

1-7

9-4

X

Set

s fo

rth

stan

dard

s to

saf

egua

rd c

onsu

mer

s fr

om d

ecep

tive

and

dupl

icito

us m

arke

ting

prac

tices

with

res

pect

to

the

use

of s

enio

r-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

so

licita

tion,

sal

e, o

r pu

rcha

se o

f, o

r ad

vice

mad

e co

ncer

ning

, a

life

insu

ranc

e or

ann

uity

pro

duct

. Ado

pts

a su

bsta

ntia

lly s

imila

r ve

rsio

n of

the

NAI

C M

odel

.

Prop

. Rul

e 76

0 IA

C 1

-79

X

Hea

ring

dat

e: 5

/7/1

2 Th

e pr

opos

ed n

ew r

ule

sets

for

th s

tand

ards

to

safe

guar

d co

nsum

ers

from

dec

eptiv

e an

d du

plic

itous

mar

ketin

g pr

actic

es w

ith r

espe

ct t

o th

e us

e of

sen

ior-

spec

ific

cert

ifica

tions

and

pro

fess

iona

l des

igna

tions

in

the

sol

icita

tion,

sal

e, o

r pu

rcha

se o

f, o

r ad

vice

mad

e co

ncer

ning

, a

life

insu

ranc

e or

ann

uity

pro

duct

. W

ould

ado

pt a

sub

stan

tially

si

mila

r ve

rsio

n of

the

NAI

C M

odel

.

760

IN A

dmin

. Cod

e 1-

72-

1 X

Sig

ned

by t

he G

over

nor:

4/

6/11

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Bul

letin

184

X

Ann

uity

Tra

inin

g Cou

rse

Req

uire

men

t (A

gent

s Li

cens

ed P

rior

to

1/1/

12):

7/

1/12

Ann

uity

Tra

inin

g Cou

rse

Req

uire

men

t (A

gent

s Li

cens

ed A

fter

1/1

/12)

: Im

med

iate

Prov

ides

cla

rific

atio

n to

HB 1

015

and

HB 1

486

rega

rdin

g th

e ef

fect

ive

date

s fo

r th

e im

plem

enta

tion

of t

he t

rain

ing

prov

isio

ns a

nd

the

requ

irem

ent

for

variab

le li

cens

ing.

Th

e Bul

letin

als

o pr

ovid

es

clar

ifica

tion

for

the

insu

rer

trai

ning

pro

visi

ons

as w

ell a

s an

ex

empt

ion

to t

he v

aria

ble

licen

sing

pro

visi

ons

for

thos

e pr

oduc

ers

who

onl

y se

ll, s

olic

it or

neg

otia

te t

o pe

nsio

n, r

etirem

ent,

or

prof

it-

shar

ing

plan

s.

The

ACLI

wor

ked

clos

ely

with

the

Dep

artm

ent

on t

he

deta

ils o

f th

e Bul

letin

, an

d in

par

ticul

ar,

soug

ht fur

ther

cla

rific

atio

n

Pag

e 27

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

14

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Prod

uct

Spec

ific

Trai

ning

Req

uire

men

t: 1

/1/1

2 on

a r

easo

nabl

e ef

fect

ive

date

as

wel

l as

the

exem

ptio

n to

the

va

riab

le li

cens

ing

law

.

Rul

e 71

0 IA

C 4

-10-

2

X

Effe

ctiv

e: 6

/28/

10

The

new

rul

e, b

ased

on

the

Nor

th A

mer

ican

Sec

uriti

es

Adm

inis

trat

ors

Ass

ocia

tion

mod

el r

ule,

pro

hibi

ts t

he u

se o

f se

nior

sp

ecifi

c de

sign

atio

ns o

r ce

rtifi

catio

ns t

o im

ply

spec

ial t

rain

ing

or

know

ledg

e w

hen

advi

sing

sen

ior

citiz

ens

or r

etiree

s ab

out

inve

stin

g,

purc

hasi

ng o

r se

lling

sec

uriti

es.

IOW

A

Bes

t Pr

actic

es L

ette

r X

O

n Ap

ril 1

4, t

he I

nsur

ance

Div

isio

n se

nt a

“be

st p

ract

ices

” le

tter

to

all I

owa

licen

sed

annu

ity s

elle

rs.

The

lett

er p

rovi

des

guid

ance

fro

m

the

divi

sion

on

the

inte

rpre

tatio

n of

191

IAC

15.

75,

suita

bilit

y in

an

nuity

tra

nsac

tions

. It

des

crib

es a

reas

a r

epor

t sh

ould

con

tain

to

dete

rmin

e th

e ef

fect

iven

ess

of t

he S

uper

visi

on S

yste

m.

Bul

letin

13-

03

X

D

ate:

10/

21/1

3 Th

is b

ulle

tin a

lert

s in

sure

rs a

bout

the

thr

ee n

ew v

ersi

ons

of t

he

defe

rred

ann

uity

buy

er's

gui

de a

dopt

ed b

y th

e N

AIC. In

sure

rs a

nd

prod

ucer

s ar

e en

cour

aged

to

use

the

appr

opriat

e ne

wer

ver

sion

s as

so

on a

s po

ssib

le a

lthou

gh t

hey

can

use

an a

ppro

pria

te v

ersi

on o

f th

e ne

w N

AIC d

efer

red

annu

ity b

uyer

's g

uide

or

the

olde

r ve

rsio

n of

th

e N

AIC d

efer

red

annu

ity b

uyer

's t

hrou

gh M

arch

31,

201

4. A

fter

th

at d

ate,

com

pani

es a

nd p

rodu

cers

sel

ling

any

fixed

ann

uity

and

th

ose

selli

ng v

aria

ble

annu

ities

or

othe

r se

curitie

s re

gist

ered

pr

oduc

ts m

ust

use

an a

ppro

pria

te v

ersi

on o

f th

e ne

w N

AIC a

nnui

ty

buye

r's

guid

e.

Bul

letin

13-

01

X

D

ate:

4/3

/13

This

bul

letin

pro

vide

s gu

idan

ce c

once

rnin

g pr

ovis

ions

on

annu

ity

disc

losu

re r

equi

rem

ents

incl

udin

g st

anda

rds

for

annu

ity il

lust

ratio

ns,

the

Buy

er's

Gui

de, an

d th

e co

nten

t of

dis

clos

ure

docu

men

ts.

This

bu

lletin

sup

erse

des

prio

r m

emos

and

rel

ated

e-m

ail.

Rul

e 19

1-15

.61+

X

Ef

fect

ive:

4/1

1/12

Am

endm

ents

bring

the

ann

uity

dis

clos

ure

rule

s of

the

unf

air

trad

e pr

actic

es c

hapt

er in

to c

onfo

rmity

with

the

NAI

C m

odel

. Th

e am

endm

ents

incl

ude

expa

ndin

g th

e se

ctio

n on

app

licab

ility

and

sc

ope,

add

ing

new

def

initi

ons

and

spec

ifyin

g re

quirem

ents

for

pr

ovid

ing

the

Buy

er's

Gui

de t

o m

ail s

olic

itatio

n an

d In

tern

et

appl

ican

ts.

The

amen

ded

rule

con

tain

s va

riou

s co

mpl

ianc

e da

tes.

Rul

e 19

1-15

.68+

X

Effe

ctiv

e: 0

1/01

/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 28

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

15

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Bul

letin

09-

04

X

O

n M

arch

26,

200

9, t

he D

ivis

ion

of I

nsur

ance

issu

ed B

ulle

tin 0

9-04

ad

dres

sing

Life

Ins

uran

ce a

nd A

nnui

ty S

ales

Pra

ctic

es,

Rep

lace

men

ts a

nd S

uita

bilit

y. A

CLI

has

rec

eive

d se

vera

l que

stio

ns

conc

erni

ng t

he r

epor

ting

requ

irem

ents

. It

app

ears

the

Div

isio

n w

ill

rely

on

com

pani

es t

o im

plem

ent

thei

r ow

n m

onito

ring

sys

tem

. Fo

llow

ing

is g

uida

nce

we

rece

ived

fro

m t

he D

ivis

ion.

Adm

in.

Cod

e §1

91-

10.1

9(52

2B)

& §

191-

15.8

(3)

X

Ado

pted

200

8

Effe

ctiv

e: 1

/1/0

9 Pr

oduc

ers

shal

l com

ply

with

rul

e 19

1-10

.19(

522B

) in

usi

ng s

enio

r-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

sal

e of

life

in

sura

nce

and

annu

ities

.

Adm

in.

Cod

e §1

91-1

5.8

Gen

eral

sui

tabi

lity

stan

dard

s no

t ba

sed

on N

AIC S

enio

r Pr

otec

tion

Mod

el. Reg

. 19

1-15

.68+

[507

B]

(bel

ow)

amen

ded

§ 19

1-15

.8 t

o re

mov

e re

fere

nces

to

annu

ities

.

Adm

in.

Cod

e §§

191

-15.

61

to 1

91-1

5.67

X

Ado

pted

200

3.

KA

NS

AS

Reg

. K.A

.R. 40

-2-1

4a

Polic

y an

d Pr

oced

ure

Reg

ardi

ng S

uita

bilit

y in

Ann

uity

Tra

nsac

tions

X

Reg

. Ef

fect

ive:

6/1

/13

Am

ende

d re

gula

tion

adop

ts b

y re

fere

nce

the

Nov

embe

r 29

, 20

12,

vers

ion

of t

he K

ansa

s In

sura

nce

Dep

artm

ent's

"Po

licy

and

Proc

edur

e Reg

ardi

ng S

uita

bilit

y in

Ann

uity

Tra

nsac

tions

." T

he a

men

ded

regu

latio

n br

ings

Kan

sas

law

into

con

form

ity w

ith t

he r

evis

ed N

AIC

Mod

el.

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Reg

. K.A

.R. 40

-9-2

3

X

Effe

ctiv

e: 1

/14/

11

Ado

pts

the

NAI

C m

odel

reg

ulat

ion

on t

he u

se o

f se

nior

-spe

cific

ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

sal

e of

life

in

sura

nce

and

annu

ities

. Ea

rlie

r th

is y

ear

Kan

sas

had

alre

ady

issu

ed

a po

licie

s an

d pr

oced

ures

doc

umen

t w

hich

ado

pted

the

sub

stan

ce o

f th

e N

AIC m

odel

. Reg

ulat

ion

40-9

-23

mer

ely

codi

fies

the

NAI

C m

odel

as

law

.

Reg

. K.A

.R. 81

-3-6

+

X

Effe

ctiv

e: 5

/22/

09

The

amen

dmen

ts t

o th

e O

ffic

e of

the

Sec

uriti

es C

omm

issi

oner

's

regu

latio

ns m

ake

it di

srep

utab

le for

a b

roke

r-de

aler

, ag

ent,

in

vest

men

t ad

vise

r or

inve

stm

ent

advi

ser

repr

esen

tativ

e to

use

a

prof

essi

onal

des

igna

tion

or c

ertif

icat

ion

that

gen

erat

es a

dec

eptiv

e in

fere

nce

that

the

use

r ha

s sp

ecia

lized

inst

ruct

ion

in c

ouns

elin

g se

nior

citi

zens

. Th

ey s

et o

ut t

he fra

udul

ent

and

unpr

inci

pled

pr

oced

ures

tha

t co

mpr

ise

just

ifica

tion

for

disc

iplin

e. T

he

amen

dmen

ts a

re b

ased

on

the

Mar

ch 2

008

Nor

th A

mer

ican

Sec

uriti

es A

dmin

istr

ator

s As

soci

atio

n M

odel

Rul

e on

the

Use

of

Sen

ior-

Spec

ific

Cer

tific

atio

ns a

nd P

rofe

ssio

nal D

esig

natio

n.

Pag

e 29

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

16

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

KEN

TUC

KY

Mem

o: A

nnui

ty S

uita

bilit

y Tr

aini

ng

X

Dat

ed:

12/1

4/11

M

emo

outli

nes

the

prod

uct

spec

ific

cont

inui

ng e

duca

tion

and

trai

ning

req

uire

men

ts for

any

res

iden

t in

sura

nce

prod

ucer

s w

ho s

ell,

solic

it, o

r ne

gotia

te t

he s

ale

of a

n an

nuity

. Th

e m

emo

stat

es t

hat

insu

rers

who

offer

ann

uitie

s sh

all g

et v

erifi

catio

n th

at p

rodu

cers

re

ceiv

e tr

aini

ng,

mai

ntai

n re

cord

s un

der

Ken

tuck

y's

reco

rd r

eten

tion

requ

irem

ent,

and

mak

e th

e ve

rific

atio

n av

aila

ble

to t

he

Com

mis

sion

er u

pon

requ

est.

Reg

. 80

6 KAR

9:0

20

ACLI

Com

men

ts

X

Effe

ctiv

e: 1

2/2/

11

Am

ende

d re

gula

tion

incl

udes

som

e of

the

pro

visi

ons

in t

he N

AIC

M

odel

Reg

ulat

ion

on t

he U

se o

f Sen

ior-

Spe

cific

Cer

tific

atio

ns a

nd

Prof

essi

onal

Des

igna

tions

In

The

Sta

te o

f Li

fe I

nsur

ance

and

Ann

uitie

s (N

AIC

278

-1).

Spe

cific

ally

, it

adds

a p

rovi

sion

sta

ting

that

a

pers

on s

hall

not

impl

y or

pur

port

to

conv

ey g

reat

er s

kill

or

know

ledg

e ad

visi

ng s

enio

rs in

the

sal

e or

sol

icita

tion

of li

fe

insu

ranc

e or

ann

uity

pro

duct

s (S

ectio

n 2(

3)).

Th

e re

gula

tion

also

in

clud

es n

ew la

ngua

ge r

egar

ding

the

“co

mbi

natio

n of

wor

ds”

and

exem

ptio

ns for

cer

tain

job

titl

es (

sim

ilar

to s

ectio

ns C

and

D o

f th

e N

AIC

Mod

el).

Th

e re

gula

tion

does

not

ado

pt t

he e

ntire

NAI

C M

odel

an

d th

e am

endm

ents

are

not

wor

d-fo

r-w

ord

NAI

C.

Reg

. 80

6 KAR

12:

120

ACLI

Com

men

ts

X

Reg

. Ef

fect

ive:

1/1

/12

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Reg

. 80

6 KAR

9:2

20

X

Reg

. Ef

fect

ive:

10/

7/11

Am

ends

reg

ulat

ion

to r

equi

re in

sura

nce

prod

ucer

s w

ho s

ell,

solic

it or

ne

gotia

te t

he s

ale

of a

nnui

ties

to c

ompl

ete

four

hou

rs o

f tr

aini

ng in

th

e cl

assi

ficat

ion

and

use

of a

nnui

ties,

tax

atio

n, s

ales

pra

ctic

es,

and

repl

acem

ent

and

disc

losu

re r

equi

rem

ents

.

Reg

. 80

8 KAR

10:

042

X

Effe

ctiv

e: 2

/6/0

9 Es

tabl

ishe

s st

anda

rds

and

requ

irem

ents

for

use

of se

nior

-spe

cific

ce

rtifi

catio

ns a

nd d

esig

natio

ns in

sal

e of

sec

uriti

es.

Reg

. 80

6 KAR

12:

150

X

Ado

pted

200

7 Ef

fect

ive

1/1/

08

This

new

ver

sion

was

am

ende

d to

inco

rpor

ate

com

men

ts r

ecei

ved

afte

r he

arin

gs w

ere

held

on

June

26

with

com

men

ts r

eque

sted

by

July

6.

Pag

e 30

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

17

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

LOU

ISIA

NA

37 L

A AD

C P

t XI

II, §1

1703

X

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

MA

INE

Prop

osed

Rul

e R. 02

-031

Ch.

917

ACLI

Com

men

ts

X

Th

e pr

opos

ed a

men

dmen

ts t

o th

e ru

le o

n su

itabi

lity

in a

nnui

ty

tran

sact

ions

wou

ld p

rovi

de a

sig

nific

antly

alte

red

fram

ewor

k fo

r de

term

inin

g an

nuity

sui

tabi

lity,

req

uire

pro

duce

r tr

aini

ng a

nd

requ

ire,

whe

re f

easi

ble,

sui

tabi

lity

stan

dard

s co

nsis

tent

with

tho

se

impo

sed

by F

INRA.

The

am

ende

d ru

le w

ould

als

o re

flect

201

0 ch

ange

s to

the

NAI

C S

uita

bilit

y in

Ann

uity

Tra

nsac

tions

Mod

el

Reg

ulat

ion.

Prop

osed

am

endm

ents

to

Rul

e Cha

pter

915

and

to

Rul

e Cha

pter

917

ACLI

Com

men

t Le

tter

(D

iscl

osur

e)

ACLI

Com

men

t Le

tter

(S

uita

bilit

y)

X

X

The

Bur

eau

of I

nsur

ance

has

pro

pose

d am

endm

ents

to

Rul

e Cha

pter

91

5 (A

nnui

ty D

iscl

osur

e) a

nd t

o Rul

e Cha

pter

917

(Ann

uity

Sui

tabi

lity)

. Th

e pu

rpos

es o

f th

e pr

opos

ed a

men

dmen

ts t

o Rul

e 91

5 ar

e to

inco

rpor

ate

Nat

iona

l Ass

ocia

tion

of I

nsur

ance

Com

mis

sion

er

(NAIC

) Ann

uity

Dis

clos

ure

Mod

el R

egul

atio

n re

quirem

ents

rel

atin

g to

illu

stra

tions

and

rec

ordk

eepi

ng r

elat

ing

to d

iscl

osur

es, as

wel

l as

to r

epea

l the

req

uire

d us

e of

an

outd

ated

NAI

C A

nnui

ty B

uyer

's

Gui

de a

nd r

epla

ce it

with

cur

rent

ver

sion

s. T

he b

urea

u w

ill h

old

a pu

blic

hea

ring

on

the

prop

osed

am

endm

ents

to

Rul

e 91

5 at

the

D

epar

tmen

t of

Pro

fess

iona

l and

Fin

anci

al R

egul

atio

n bu

ildin

g, 7

6 N

orth

ern

Aven

ue, G

ardi

ner,

Mai

ne a

t 9:

00 a

.m.

on D

ecem

ber

17.

The

prop

osed

am

endm

ents

to

Rul

e 91

7 w

ould

est

ablis

h su

itabi

lity

stan

dard

s an

d pr

oduc

er t

rain

ing

requ

irem

ents

with

res

pect

to

annu

ity r

ecom

men

datio

ns m

ade

by in

sura

nce

prod

ucer

s or

co

mpa

nies

. Th

ey a

re in

tend

ed t

o re

flect

cha

nges

mad

e in

201

0 to

th

e N

AIC S

uita

bilit

y in

Ann

uity

Tra

nsac

tions

Mod

el R

egul

atio

n in

lig

ht o

f th

e H

arki

ns-M

eek

Amen

dmen

t to

the

Dod

d-Fr

ank

Act;

tha

t am

endm

ent

prov

ides

a "

safe

har

bor"

fro

m t

reat

men

t of

equ

ity-

inde

xed

annu

ities

as

fede

ral s

ecur

ities

in jur

isdi

ctio

ns w

hich

hav

e ad

opte

d th

e 20

10 a

men

dmen

ts t

o th

e N

AIC S

uita

bilit

y in

Ann

uity

Tr

ansa

ctio

ns M

odel

Reg

ulat

ion.

Bul

letin

389

X

D

ated

: 10

/8/1

3 Th

is b

ulle

tin a

lert

s in

sure

rs a

nd p

rodu

cers

tha

t un

til t

he I

nsur

ance

Bur

eau

offic

ially

rev

ises

Mai

ne R

ule

915

(Ann

uity

Dis

clos

ure)

, Sec

tion

5 (S

tand

ards

for

the

Dis

clos

ure

Doc

umen

t an

d Buy

er's

G

uide

), t

hey

are

perm

itted

to

use

the

NAI

C's

rec

ently

rev

ised

Buy

er's

Gui

de in

the

ir a

nnui

ty d

iscl

osur

es in

pla

ce o

f th

e ou

tdat

ed

1998

Buy

er's

Gui

de.

Ins.

Reg

. ch

. 91

5

X

Ado

pted

200

4.

Cod

e M

E R. 02

-031

Ch.

X

Ado

pted

200

7.

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 31

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

18

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

917

§2

MA

RY

LAN

D

Reg

. 31

.09.

12.0

1+

Bul

letin

11-

28

Bul

letin

11-

10

X X X

Reg

. Ef

fect

ive:

11/

1/11

Pr

oduc

t Sp

ecifi

c Tr

aini

ng

Req

uire

men

t: 1

1/1/

11

Ann

uity

Tra

inin

g Cou

rse

Req

uire

men

t (A

gent

s Li

cens

ed P

rior

to

Reg

. Ef

fect

ive

Dat

e):

5/1/

12

Ann

uity

Tra

inin

g Cou

rse

Req

uire

men

t (A

gent

s Li

cens

ed A

fter

Reg

. Ef

fect

ive

Dat

e):

Imm

edia

te

Dat

ed:

9/13

/11

Dat

ed:

5/13

/11

The

suita

bilit

y in

ann

uity

tra

nsac

tions

reg

ulat

ion,

whi

ch g

ener

ally

fo

llow

s th

e N

AIC m

odel

reg

ulat

ion

with

min

or d

evia

tions

, ad

opt

amen

dmen

ts t

o se

ctio

ns o

n du

ties

of in

sure

rs a

nd p

rodu

cers

, de

finiti

ons,

sup

ervi

sion

sys

tem

s, p

rodu

cer

proh

ibite

d ac

ts,

FIN

RA

requ

irem

ents

, pr

oduc

er t

rain

ing,

and

com

plia

nce.

Bul

letin

ans

wer

s qu

estio

ns r

egar

ding

the

ado

ptio

n of

the

Nat

iona

l Ass

ocia

tion

of I

nsur

ance

Com

mis

sion

ers

Sui

tabi

lity

in A

nnui

ty

Tran

sact

ions

Mod

el R

egul

atio

n an

d ne

w r

equi

rem

ents

for

insu

ranc

e pr

oduc

ers

selli

ng a

nnui

ty p

rodu

cts

effe

ctiv

e N

ovem

ber

1, 2

011.

Th

is b

ulle

tin n

otifi

es in

sure

rs o

f am

endm

ents

to

the

suita

bilit

y in

an

nuity

tra

nsac

tions

reg

ulat

ion

whi

ch g

ener

ally

fol

low

s th

e N

AIC

m

odel

with

min

or d

evia

tions

. T

he a

men

dmen

ts a

re e

ffec

tive

Nov

embe

r 1,

201

1.

Reg

. 31

.03.

15

X

Effe

ctiv

e: 4

/4/2

011

Def

ines

wha

t co

nstit

utes

mis

lead

ing

use

of a

sen

ior

retir

ee

cred

entia

l or

desi

gnat

ion

by a

dvis

ors

and

insu

ranc

e pr

oduc

ers

in

conn

ectio

n w

ith li

fe in

sura

nce,

hea

lth in

sura

nce,

or

annu

ities

. Ado

pts

a su

bsta

ntia

lly s

imila

r ve

rsio

n of

the

NAI

C S

enio

r D

esig

natio

ns M

odel

.

S.

774

H.

882

X X

Sig

ned

by G

over

nor:

5/

20/1

0 Ef

fect

ive:

7/1

/201

0

Set

s fo

rth

stan

dard

s to

pro

tect

con

sum

ers

from

dis

hone

st,

dece

ptiv

e, m

isle

adin

g an

d fr

audu

lent

tra

de p

ract

ices

in t

he u

se o

f se

nior

-spe

cific

cer

tific

atio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

m

arke

ting,

sol

icita

tion,

neg

otia

tion,

sal

e, a

nd p

urch

ase

of, an

d ad

vice

giv

en in

con

nect

ion

with

, lif

e in

sura

nce,

hea

lth in

sura

nce

and

annu

ities

. Pr

ohib

its a

per

son

from

usi

ng a

sen

ior-

spec

ific

cert

ifica

tion

or p

rofe

ssio

nal d

esig

natio

n in

a w

ay t

hat

wou

ld m

isle

ad

a pu

rcha

ser

of li

fe in

sura

nce,

hea

lth in

sura

nce,

or

an a

nnui

ty a

bout

sp

ecifi

ed m

atte

rs.

Req

uire

s th

e in

sura

nce

com

mis

sion

er, by

re

gula

tion

or o

rder

, to

spe

cify

wha

t co

nstit

utes

a m

isle

adin

g us

e of

se

nior

-spe

cific

cer

tific

atio

ns o

r pr

ofes

sion

al d

esig

natio

ns.

Pag

e 32

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

19

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

H.

571

X

Sig

ned

by G

over

nor:

5/7

/09

Effe

ctiv

e: 5

/7/0

9 As

enac

ted,

pro

hibi

ts a

per

son

from

usi

ng a

sen

ior

or r

etiree

cr

eden

tial o

r de

sign

atio

n in

a w

ay t

hat

is m

isle

adin

g in

con

nect

ion

with

the

offer

, sa

le,

or p

urch

ase

of a

ny s

ecur

ity, or

in a

dvis

ing

anot

her

pers

on a

s to

the

val

ue,

purc

hase

, or

sal

e of

any

sec

urity

. Spe

cifie

s th

e fa

ctor

s to

be

cons

ider

ed in

det

erm

inin

g w

heth

er a

pe

rson

is u

sing

a s

enio

r-sp

ecifi

c ce

rtifi

catio

n or

pro

fess

iona

l de

sign

atio

n. (

Sam

e as

HB5

71)

[Not

e: "

secu

rity

" is

def

ined

to

not

incl

ude

any

insu

ranc

e or

end

owm

ent

polic

y or

ann

uity

con

trac

t un

der

whi

ch a

n in

sura

nce

com

pany

pro

mis

es t

o pa

y m

oney

eith

er in

a

lum

p su

m, pe

riod

ical

ly for

life

, or

som

e ot

her

spec

ified

per

iod.

"]

S.

684

X

Sig

ned

by G

over

nor:

5/7

/09

Effe

ctiv

e: 5

/7/0

9 (S

ame

as H

. 57

1)

Adm

in.

Cod

e §§

31

.15.

04.0

1 to

31

.15.

04.0

7

Ado

pted

198

0.

Var

iatio

n of

the

NAIC

Ann

uity

Dis

clos

ure

Mod

el.

Reg

. 31

.09.

12.0

1+

X

Ado

pted

200

7.

Effe

ctiv

e: 7

/1/0

7.

Sim

ilar

to t

he N

AIC

Sui

tabi

lity

Mod

el.

ACLI

sub

mitt

ed c

omm

ents

on

2/1/

07.

Sec

. 6

of t

he a

dopt

ed r

eg. ha

s be

en a

men

ded

slig

htly

(fr

om t

he

prop

osed

reg

.) t

o re

flect

tha

t co

mpl

ianc

e w

ith t

he N

ASD

Con

duct

Rul

es s

atis

fies

com

plia

nce

with

the

reg

ulat

ion.

MA

SS

AC

HU

SET

TS

Prop

osed

Reg

. 21

1 CM

R

96.0

1+

X

Th

e pr

opos

ed a

men

dmen

ts t

o th

e re

gula

tion

on c

onsu

mer

pr

otec

tion

in a

nnui

ty t

rans

actio

ns w

ould

mak

e it

com

ply

with

the

up

date

d N

AIC M

odel

reg

ulat

ion,

incl

udin

g ad

ding

tra

inin

g re

quirem

ents

for

insu

ranc

e pr

oduc

er’s

sel

ling

annu

ities

. Th

ey w

ould

al

so in

clud

e ex

pand

ing

the

sect

ion

on d

utie

s of

insu

ranc

e pr

oduc

ers

and

insu

rers

, an

d ad

ding

def

initi

ons.

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Opi

nion

Let

ter

The

Div

isio

n of

Ins

uran

ce p

ublis

hed

an o

pini

on le

tter

dat

ed A

ugus

t 5,

200

9, o

n th

e "s

trai

ght

thro

ugh

proc

essi

ng"

stan

dard

s in

itiat

ive

bein

g ad

voca

ted

by A

CLI

and

the

Ins

ured

Ret

irem

ent

Inst

itute

(f

orm

erly

NAVA)

that

rec

ogni

zes

the

abili

ty t

o pr

oces

s th

e sa

le o

f an

nuiti

es e

lect

roni

cally

in M

assa

chus

etts

. Aug

ust

6 Sta

te N

ews

Wee

kly

Reg

. 21

1 CM

R 9

6 X

Ado

pted

200

6.

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 33

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

20

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

MIC

HIG

AN

MI

Com

p. L

aws

Ann

. §5

00.4

153

X

Law

Effec

tive:

6/1

/13

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

MIN

NES

OTA

MN

Sta

t. A

nn. §7

2A.2

03-

72A.2

036

X

Law

Effec

tive:

6/1

/13

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

H.

1853

X

Enac

ted

2009

Ado

pts

the

NAI

C m

odel

on

Seni

or-S

peci

fic C

ertif

icat

ions

and

Pr

ofes

sion

al D

esig

natio

ns in

the

Sal

e of

Life

Ins

uran

ce a

nd A

nnui

ties

(Sec

tion

43).

Sta

t. §

72A

.20

Enac

ted

1995

. Reg

ulat

ion

of T

rade

Pra

ctic

es-

Ann

uity

Sol

icita

tion

Sta

ndar

ds.

Sta

t. §

60k

.46

En

acte

d 20

02.

Insu

ranc

e Pr

oduc

ers-

Ann

uity

Sol

icita

tion

Sta

ndar

ds.

MIS

SIS

SIP

PI

MS A

DC 1

9-2:

18.0

1 X

Rul

e Ef

fect

ive:

4/1

0/13

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

MIS

SO

UR

I

Rul

e 20

CSR 7

00-1

.140

X

Effe

ctiv

e: 1

/1/0

9 Th

e ne

w s

ectio

n, w

hich

is c

onsi

sten

t w

ith t

he N

AIC

mod

el

regu

latio

n, e

stab

lishe

s pr

ovis

ions

on

the

perm

issi

ble

use

of s

enio

r-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns. In

clud

es

proh

ibite

d us

es o

f su

ch c

ertif

icat

ions

and

des

igna

tions

and

acc

epte

d ac

cred

iting

ent

ities

.

Rul

e 20

CSR 7

00-1

.146

Effe

ctiv

e: 7

/30/

08

Am

ends

the

sta

ndar

ds o

f pr

ofes

sion

al c

ondu

ct for

insu

ranc

e pr

oduc

ers

selli

ng v

aria

ble

annu

ities

and

var

iabl

e lif

e in

sura

nce.

Als

o in

clud

es n

ew s

ectio

ns o

n st

anda

rds

of p

rodu

cer

cond

uct

for

fixed

an

d in

dexe

d an

nuiti

es.

Rul

e 20

CSR 7

00-1

.147

Effe

ctiv

e: 7

/30/

08

This

rul

e am

ends

pro

visi

ons

on s

uper

visi

on in

the

sal

e of

var

iabl

e an

nuiti

es a

nd v

aria

ble

life

insu

ranc

e to

rep

lace

ref

eren

ces

to t

he

Nat

iona

l Ass

ocia

tion

of S

ecur

ities

Dea

lers

(N

ASD

) w

ith t

he F

inan

cial

In

dust

ry R

egul

ator

y Aut

hority

(FI

NRA).

Rul

e 20

CSR 7

00-1

.148

Effe

ctiv

e: 1

2/30

/08

Rul

e 20

CSR 4

00-5

.410

X

Ado

pted

200

7.

Effe

ctiv

e: 1

/30/

07

Sim

ilar

to t

he N

AIC

Dis

clos

ure

Mod

el.

Pag

e 34

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

21

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

MO

Ann

. Sta

t. §

376.

671

20

MO

Cod

e Reg

s. 4

00-

1.02

0

20 M

O C

ode

Reg

s. 7

00-

1.14

6

X

N

on m

odel

, su

itabi

lity

prov

isio

ns.

MO

NTA

NA

Adm

in.

R. 6.

6.80

1- 6

.6.8

06

X

Ado

pted

199

8 an

d 19

99.

MT

Cod

e Ann

. §3

3-20

-802

X

Sig

ned

by t

he g

over

nor

on

5/8/

07.

Effe

ctiv

e 10

/1/0

7.

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

NEB

RA

SK

A

NE

Rev

. St.

§44

-810

3 X

Law

Effec

tive:

7/1

9/12

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Bul

letin

CB-1

28

X

Dat

ed:

July

6, 20

12

Bul

letin

res

pond

s to

que

ries

rec

eive

d by

the

Neb

rask

a D

epar

tmen

t of

Ins

uran

ce r

egar

ding

ann

uity

tra

inin

g re

quirem

ents

for

pro

duce

rs

who

hol

d a

life

insu

ranc

e lin

e of

aut

hority

. In

sura

nce

prod

ucer

s w

ho

hold

a li

fe in

sura

nce

line

of a

utho

rity

and

wan

t to

sol

icit

the

sale

of

annu

ity p

rodu

cts

are

requ

ired

to

com

plet

e, w

ithin

6 m

onth

s af

ter

July

19,

201

2, a

one

-tim

e, fou

r-cr

edit

trai

ning

cou

rse

appr

oved

by

the

Dep

artm

ent

of I

nsur

ance

.

NEV

AD

A

Reg

. Cha

pter

686

A

X

Effe

ctiv

e: 7

/1/1

1 Ado

pts

new

pro

visi

ons

regu

latin

g th

e us

e of

sen

ior-

spec

ific

cert

ifica

tions

and

pro

fess

iona

l des

igna

tions

, in

clud

ing

proh

ibiti

ng a

pr

oduc

er fro

m u

sing

sen

ior-

spec

ific

cert

ifica

tions

or

prof

essi

onal

de

sign

atio

ns w

hen

the

prod

ucer

has

not

rec

eive

d an

y sp

ecia

lized

tr

aini

ng in

the

ser

vici

ng o

f se

nior

s fr

om a

qua

lifie

d or

gani

zatio

n (S

imila

r to

NAI

C M

odel

).

NV S

T §

688A

.450

X

X

Ado

pted

200

5.

Re-

prop

osed

and

ado

pted

in

2006

.

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Als

o se

e Bul

letin

No.

06-

004.

NEW

HA

MP

SH

IRE

NH

Cod

e Ad

min

. R. In

s.

305.

02

NH

Bul

letin

IN

S 1

4-03

6-AB

X

Effe

ctiv

e: 1

/1/2

015

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 35

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

22

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Adm

in.

Cod

e In

s.

301.

06(1

)

Com

mis

sion

er S

evig

ny h

as p

ublis

hed

a Bul

letin

(07

-47-

AB)

that

ou

tline

s th

e D

epar

tmen

t's p

ositi

on o

n su

itabi

lity

stan

dard

to

both

lif

e in

sura

nce

and

annu

ities

. ACLI

has

com

men

ted

to t

he C

omm

issi

oner

of In

sura

nce

on h

is

rece

nt s

uita

bilit

y Bul

letin

07-

047-

AB,

expr

essi

ng it

s de

ep c

once

rns

with

the

new

com

plia

nce

requ

irem

ents

for

insu

rers

set

for

th in

the

Bul

letin

.

Rul

e 31

1.01

+

X

Effe

ctiv

e: 3

/1/0

9 Th

e ne

w r

ule

on u

sing

sen

ior

spec

ific

cert

ifica

tions

and

pro

fess

iona

l de

sign

atio

ns is

bas

ed o

n th

e N

AIC

mod

el a

nd e

stab

lishe

s m

easu

res

for

usin

g th

e de

sign

atio

ns in

the

sol

icita

tion,

rec

omm

enda

tion,

sal

e or

acq

uisi

tion

of li

fe in

sura

nce

and

annu

ity p

rodu

cts.

Adm

in.

Cod

e In

s. 3

06.0

2 to

30

6.9

Ado

pted

198

3 an

d 20

01.

Var

iatio

n of

the

NAIC

Ann

uity

Dis

clos

ure

Mod

el.

The

se s

ectio

ns

have

all

expi

red

as o

f 20

09.

Pag

e 36

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

23

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

NEW

JER

SEY

Bul

letin

14-

05

x

Ef

fect

ive:

06/

30/1

4 Bul

letin

pro

vide

s in

sure

rs a

nd in

sura

nce

prod

ucer

s w

ith a

n up

date

d N

AIC

Buy

er's

Gui

de for

Def

erre

d Ann

uitie

s, u

se o

f w

hich

is r

equi

red

by J

une

30, 20

14.

Per

the

Bul

letin

, th

e D

OBI

is n

otify

ing

all

auth

oriz

ed/a

dmitt

ed in

sure

rs a

nd a

ll in

sura

nce

prod

ucer

s/ag

ents

th

at t

rans

act

annu

ity b

usin

ess

in N

ew J

erse

y, t

hat

the

NAI

C h

as

adop

ted

a ne

w B

uyer

's G

uide

and

the

DO

BI h

as p

oste

d th

e ne

w

Buy

er's

Gui

de o

n its

web

site

. Pu

rsua

nt t

o N

.J.A

.C. 11

:4-5

9.3(

b),

an

insu

rer

shal

l pro

vide

a c

onsu

mer

who

app

lies

for

an a

nnui

ty,

a bu

yer's

guid

e re

gard

ing

the

sale

of

annu

ities

, as

app

rove

d by

the

N

AIC

and

sha

ll ut

ilize

the

Buy

er's

Gui

de t

o Fi

xed

Def

erre

d An

nuiti

es.

Insu

rers

and

indi

vidu

als

subj

ect

to t

he n

otic

e re

quirem

ent

may

be

gin

to u

se t

he p

oste

d Buy

er's

Gui

de im

med

iate

ly,

but

mus

t ut

ilize

it

no la

ter

than

Jun

e, 3

0, 2

014.

Bul

letin

Cla

rific

atio

n: A

s pr

evio

usly

rep

orte

d, t

he N

ew J

erse

y D

epar

tmen

t of

Ban

king

and

Ins

uran

ce (

DO

BI)

issu

ed B

ulle

tin N

o.

14-0

5, U

se o

f Ann

uity

Buy

er’s

Gui

de, on

Apr

il 2,

201

4. T

his

bulle

tin

notif

ies

all a

utho

rize

d/ad

mitt

ed in

sure

rs a

nd a

ll in

sura

nce

prod

ucer

s/ag

ents

tha

t tr

ansa

ct a

nnui

ty b

usin

ess

in N

ew J

erse

y, t

hat

the

NAI

C h

as a

dopt

ed a

new

buy

er's

gui

de a

nd t

he D

OBI

has

pos

ted

the

new

buy

er’s

gui

de o

n its

web

site

. Pe

r th

e bu

lletin

, pu

rsua

nt t

o N

.J.A

.C.

11:4

-59.

3(b)

, an

insu

rer

shal

l pro

vide

a c

onsu

mer

who

ap

plie

s fo

r an

ann

uity

a b

uyer

’s g

uide

reg

ardi

ng t

he s

ale

of

annu

ities

, as

app

rove

d by

the

NAIC

and

sha

ll ut

ilize

the

NAI

C

Buy

er’s

Gui

de t

o Fi

xed

Def

erre

d Ann

uitie

s. I

nsur

ers

and

indi

vidu

als

subj

ect

to t

he n

otic

e re

quirem

ent

may

beg

in t

o us

e th

e po

sted

bu

yer’s

guid

e im

med

iate

ly,

but

mus

t ut

ilize

it n

o la

ter

than

Jun

e,

30, 20

14.

The

bulle

tin f

urth

er p

rovi

des

that

the

buy

er’s

gui

de s

hall

be “

mod

ified

” to

ref

lect

the

10

and

15 c

ance

llatio

n pe

riod

s pe

r N

ew

Jers

ey la

w 1

1:4-

59.3

. AC

LI h

as c

onfir

med

with

the

DO

BI t

hat

it is

not

the

inte

nt o

f th

e D

OBI

to

requ

ire

insu

rers

to

mod

ify t

he N

AIC

Buy

er’s

Gui

de fre

e lo

ok la

ngua

ge.

Per

the

DO

BI,

New

Jer

sey’

s fr

ee

look

law

s ar

e ad

equa

tely

des

crib

ed in

the

new

NAI

C B

uyer

’s G

uide

an

d th

ere

is n

o ne

ed for

insu

rers

to

mak

e an

y ch

ange

s.

Upd

ate:

As

prev

ious

ly r

epor

ted,

the

Dep

artm

ent

of B

anki

ng a

nd

Insu

ranc

e (D

OBI

) is

sued

Bul

letin

No.

14-

05 n

otify

ing

insu

rers

tha

t ef

fect

ive

June

30,

201

4, t

hey

mus

t us

e th

e ne

w N

AIC B

uyer

's G

uide

to

Fix

ed D

efer

red

Ann

uitie

s. A

CLI

bec

ame

awar

e th

at t

he B

uyer

’s

Gui

de o

rigi

nally

pos

ted

on t

he D

OBI

’s w

ebsi

te w

as in

corr

ect.

It

is

now

cor

rect

ed. ACLI

has

con

firm

ed w

ith t

he D

OBI

tha

t co

mpa

nies

m

ay a

lso

cont

inue

to

use

NAI

C v

ersi

on A

NB-L

A,

Buy

er's

Gui

de for

D

efer

red

Ann

uitie

s -

Fixe

d an

d Var

iabl

e (2

013)

.

Pag

e 37

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

24

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

NJ

Adm

in. Cod

e §1

1:4-

59A.1

X

Reg

. Ef

fect

ive:

2/4

/13

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Bul

letin

13-

01

X

Dat

ed:

2/6/

13

This

Bul

letin

cla

rifie

s th

at b

y de

layi

ng t

he o

pera

tive

date

of ce

rtai

n pr

ovis

ions

on

prod

ucer

tra

inin

g an

d th

e sa

le o

f an

nuiti

es u

ntil

Aug

ust

4, 2

013,

pro

duce

rs n

ewly

lice

nsed

to

sell

annu

ities

on

or

afte

r Fe

brua

ry 4

, 20

13 m

ay s

ell t

he t

ypes

of

annu

ities

to

whi

ch t

he

rule

s ap

ply,

but

mus

t co

mpl

ete

the

requ

ired

tra

inin

g co

urse

by

Aug

ust

4, 2

013

in o

rder

to

cont

inue

to

sell

thos

e an

nuiti

es a

fter

tha

t da

te.

The

Bul

letin

als

o pr

ovid

es in

form

atio

n on

app

rove

d an

nuity

tr

aini

ng c

ours

es.

Rul

e 11

:4-6

0.1+

X

Effe

ctiv

e: 3

/7/1

1 Es

tabl

ishe

s lim

itatio

ns o

n in

sura

nce

prod

ucer

s, in

sure

rs a

nd

frat

erna

l ben

efit

soci

ety

repr

esen

tativ

es r

egar

ding

the

use

of

cert

ifica

tions

, pr

ofes

sion

al d

esig

natio

ns,

or for

ms

of a

dver

tisin

g ex

pres

sing

tha

t th

e pe

rson

or

entit

y ha

s sp

ecia

l edu

catio

n, t

rain

ing

or e

xper

ienc

e in

adv

isin

g or

ser

vici

ng s

enio

r ci

tizen

s or

ret

iree

s, in

co

nnec

tion

with

the

sol

icita

tion,

neg

otia

tion

of s

ale

of li

fe in

sura

nce.

S.

1745

X

Effe

ctiv

e: 7

/6/1

0

Ado

pts

a su

bsta

ntia

lly s

imila

r ve

rsio

n of

the

NASAA M

odel

Rul

e on

th

e U

se o

f Sen

ior-

Spe

cific

Cer

tific

atio

ns a

nd P

rofe

ssio

nal

Des

igna

tions

and

app

lies

its p

rohi

bitio

ns t

o th

e of

fer,

sal

e or

pu

rcha

se o

f a

secu

rity

.

Rev

. Sta

t. §

17B

:25-

20

En

acte

d 19

81 a

nd 2

005.

Li

mits

mat

urity

dat

es &

sur

rend

er c

harg

es for

ann

uitie

s so

ld t

o se

nior

s.

NEW

MEX

ICO

12 N

.M.

Adm

in.

Cod

e §

11.1

7.1+

X (

NAS

AA)

Effe

ctiv

e: 1

/1/1

0 Es

tabl

ishe

s st

anda

rds

and

requ

irem

ents

for

use

of se

nior

-spe

cific

ce

rtifi

catio

ns a

nd d

esig

natio

ns in

sal

e of

sec

uriti

es.

(Bas

ed o

n N

ASAA

Mod

el)

13 N

.M.

Adm

in.

Cod

e §§

9.1

2.1

to 9

.12.

13

X

Ado

pted

199

7 an

d 20

00.

Pag

e 38

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

25

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

NEW

YO

RK

A.

1787

/S. 72

54

X

Effe

ctiv

e: 1

1/21

/201

4 Le

gisl

atio

n (A

. 17

87/S

. 72

54)

enac

ted

in N

ew Y

ork

requ

ires

a

pers

on o

r bu

sine

ss u

sing

a s

enio

r sp

ecifi

c de

sign

atio

n in

adv

ertis

ing

to d

iscl

ose

the

basi

s or

sou

rce

for

the

desi

gnat

ion.

Pol

icym

aker

s pa

ssed

the

new

law

to

give

con

sum

ers

addi

tiona

l inf

orm

atio

n ab

out

the

legi

timac

y of

sen

ior

desi

gnat

ions

. If

in w

ritin

g, t

he d

iscl

osur

e re

gard

ing

the

desi

gnat

ion

mus

t be

in a

siz

e su

ffic

ient

to

be

notic

eabl

e fo

r an

ord

inar

y co

nsum

er t

o re

ad a

nd u

nder

stan

d. I

f pr

ovid

ed o

rally

, th

e m

essa

ge r

egar

ding

the

sen

ior

desi

gnat

ion

mus

t be

com

mun

icat

ed in

suc

h a

way

tha

t th

e co

nsum

er c

an h

ear

and

com

preh

end

the

notic

e. T

he n

ew la

w a

men

ds t

he g

ener

al b

usin

ess

sect

ion

of t

he N

ew Y

ork

stat

utes

and

is a

pplic

able

to

all b

usin

esse

s.

The

law

is n

ot in

sura

nce

spec

ific

and

does

not

fol

low

the

NAI

C M

odel

Reg

ulat

ion

on t

he U

se o

f Sen

ior

Spec

ific

Cer

tific

atio

ns a

nd

Prof

essi

onal

Des

igna

tions

in t

he S

ale

of L

ife I

nsur

ance

and

Ann

uitie

s.

11 N

YCRR 2

24.1

X

Effe

ctiv

e: 8

/14/

13

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

A.

634

In

trod

uced

: 1/

9/13

W

ould

pla

ce r

estr

ictio

ns o

n th

e sa

le o

f an

nuiti

es t

o se

nior

s an

d pr

ovid

e fo

r su

itabi

lity

requ

irem

ents

and

the

est

ablis

hmen

t of

a

syst

em t

o su

perv

ise

reco

mm

enda

tions

. W

ould

, am

ong

othe

r pr

ovis

ions

, re

quire

annu

al 3

hou

rs t

rain

ing

on s

uita

bilit

y in

ann

uity

an

d lif

e in

sura

nce

tran

sact

ions

and

wou

ld p

rohi

bit

the

fals

e us

e of

in

sura

nce

desi

gnat

ions

.

Reg

. 19

9

X

Effe

ctiv

e: 2

/20/

13

New

rul

e es

tabl

ish

stan

dard

s an

d re

quirem

ents

for

the

use

of

seni

or-s

peci

fic c

ertif

icat

ions

and

des

igna

tions

in t

he s

ale

of li

fe

insu

ranc

e an

d an

nuiti

es.

Als

o, s

peci

fies

proh

ibite

d us

es o

f se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns. Fo

llow

s th

e N

AIC

Mod

el R

egul

atio

n on

the

Use

of Sen

ior-

Spe

cific

Cer

tific

atio

ns

and

Prof

essi

onal

Des

igna

tions

in t

he S

ale

of L

ife I

nsur

ance

and

Ann

uitie

s.

Emer

genc

y Reg

. 19

9

X

Effe

ctiv

e: 2

/1/1

3 Ex

pire

s: 4

/2/1

3 Em

erge

ncy

regu

latio

n es

tabl

ishe

s st

anda

rds

and

requ

irem

ents

for

th

e us

e of

sen

ior-

spec

ific

cert

ifica

tions

and

des

igna

tions

in t

he s

ale

of li

fe in

sura

nce

and

annu

ities

. Spe

cifie

s pr

ohib

ited

uses

of se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns.

Emer

genc

y re

gula

tion

expi

res

April 2

, 20

13.

Emer

genc

y Reg

. 18

7 X

Effe

ctiv

e: 5

/31/

13

Expi

res:

7/29

/13

Emer

genc

y re

gula

tion

esta

blis

hes

requ

irem

ents

for

insu

rers

and

pr

oduc

ers

to d

eter

min

e a

cons

umer

s' s

uita

bilit

y pr

ior

to

reco

mm

endi

ng o

r se

lling

an

annu

ity.

This

em

erge

ncy

regu

latio

n is

su

bsta

ntia

lly s

imila

r to

the

NAI

C S

uita

bilit

y in

Ann

uity

Tra

nsac

tions

M

odel

Reg

ulat

ion.

Em

erge

ncy

regu

latio

n ex

pire

s Ju

ly 2

9, 2

013.

Pag

e 39

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

26

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Adm

in.

Cod

e tit

. 11

§§

40.

0 to

40.

6 (R

eg. 13

9)

(199

0)

§§ 5

3-1.

1 to

53-

1.6

(Reg

. 74

)

Ado

pted

199

0, 1

997

and

2003

. Var

iatio

n of

the

NAIC

Ann

uity

Dis

clos

ure

Mod

el a

ddre

ssin

g gr

oup

annu

ity c

ontr

acts

and

fun

ding

agr

eem

ents

.

NO

RTH

CA

RO

LIN

A

Rul

e 11

NCAC 1

2.04

61

X

Effe

ctiv

e: 2

/1/1

0 In

corp

orat

es b

y re

fere

nce

the

NAI

C M

odel

Reg

ulat

ion

on t

he U

se o

f Sen

ior-

Spec

ific

Cer

tific

atio

ns a

nd P

rofe

ssio

nal D

esig

natio

ns,

whi

ch

esta

blis

hes

stan

dard

s an

d re

quirem

ents

for

the

use

of se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

sal

e of

life

in

sura

nce

and

annu

ities

.

Adm

in.

Cod

e tit

. 11

ch.

12

§ .0

420

Ado

pted

197

6 an

d 19

92.

Req

uire

s su

bmis

sion

of su

itabi

lity

form

.

Gen

. Sta

tute

s §5

8-60

+

X

En

acte

d 20

05. (H

B 6

55)

Om

nibu

s bi

ll in

clud

ing

NAI

C A

nnui

ty D

iscl

osur

e m

odel

lang

uage

.

NC G

en.

Sta

t. §

58-6

0-15

5 X

Sig

ned

by t

he G

over

nor

7/28

/07.

Effec

tive

1/1/

08.

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

NO

RTH

DA

KO

TA

ND

Cen

t. C

ode

§26.

1-34

.2-

01.1

X

Law

Effec

tive:

8/1

/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

S.

2155

X

Sig

ned

by t

he G

over

nor

4/12

/07.

Ef

fect

ive:

8/1

/07.

Sim

ilar

to t

he N

AIC

Sui

tabi

lity

Mod

el.

Ther

e is

a d

evia

tion

in t

he

Miti

gatio

n of

Res

pons

ibili

ty s

ectio

n. I

t ap

pear

s to

be

a dr

aftin

g er

ror

and

is e

xpec

ted

be c

orre

cted

bef

ore

the

hear

ing.

Pa

ssed

Sen

ate

unan

imou

sly

with

an

amen

dmen

t co

rrec

ting

the

devi

atio

n in

the

sec

tion

men

tione

d ab

ove.

Adm

in.

Cod

e §

45-0

2-02

-14

Ado

pted

198

4 an

d 20

01.

Rul

es c

over

rec

omm

enda

tions

to

cons

umer

s ov

er 6

5.

OH

IO

Res

ciss

ion

Of Rul

e 39

01-6

-14

X

Ef

fect

ive:

01/

01/1

5 Th

e am

endm

ents

res

cind

the

ann

uity

dis

clos

ure

rule

bec

ause

it d

oes

not

incl

ude

refe

renc

e to

the

upd

ated

ver

sion

of th

e N

AIC A

nnui

ty

Dis

clos

ure

Buy

er's

Gui

de.

Rul

e 39

01-6

-14

X

Ef

fect

ive:

01/

01/1

5 Th

e am

endm

ents

to

the

annu

ity d

iscl

osur

e ru

le in

clud

e re

fere

nces

to

the

upda

ted

vers

ion

of t

he N

AIC A

nnui

ty D

iscl

osur

e Buy

er’s

Gui

de.

Rul

e 39

01-6

-13

X

Reg

. Ef

fect

ive:

7/1

/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 40

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

27

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Bul

letin

201

1-07

X

Dat

ed:

5/10

/11

The

bulle

tin p

rovi

des

a re

min

der

that

as

of J

uly

1, 2

011,

the

su

itabi

lity

of a

nnui

ty s

ales

rul

e im

pose

s a

new

one

-tim

e an

nuity

-sp

ecifi

c co

ntin

uing

edu

catio

n re

quirem

ent

on in

sura

nce

agen

ts w

ho

enga

ge in

the

sal

e, s

olic

itatio

n or

neg

otia

tion

of a

nnui

ty p

rodu

cts.

Th

is o

ne-t

ime

requ

irem

ent

is in

add

ition

to

the

com

pany

pro

vide

d pr

oduc

t sp

ecifi

c tr

aini

ng.

Rul

e 39

01-5

-11

X

Effe

ctiv

e: 7

/1/0

9 Cre

ates

pro

cedu

res

and

prer

equi

site

s in

the

app

licat

ion

of s

enio

r-sp

ecifi

c ce

rtifi

catio

ns a

nd d

esig

natio

ns b

y in

sura

nce

agen

ts in

the

co

unse

ling,

sal

e, s

olic

itatio

n or

neg

otia

tion

of li

fe o

r he

alth

in

sura

nce

polic

ies

or a

nnui

ty p

rodu

cts.

Reg

. 39

01-6

-14

X

Ado

pted

: 20

07.

Effe

ctiv

e: 3

/1/0

7.

Sim

ilar

to t

he N

AIC

Ann

uity

Dis

clos

ure

Mod

el.

OK

LAH

OM

A

Rul

e 36

5:25

-19-

5

X

Ef

fect

ive:

09/

15/1

4.

Am

ends

ann

uity

dis

clos

ure

prov

isio

ns t

hat

requ

ire

insu

rers

to

use

the

buye

r's

guid

e fo

und

in A

ppen

dix

S by

rev

okin

g App

endi

x S a

nd

inst

ead

requ

irin

g in

sure

rs t

o us

e th

e m

ost

curr

ent

vers

ion

of t

he

NAIC

Buy

er's

Gui

de t

o Ann

uitie

s.

Bul

letin

201

3-02

X

D

ated

: 10

/24/

13

This

bul

letin

info

rms

insu

rers

tha

t th

e In

sura

nce

Dep

artm

ent

in

2014

will

am

end

its r

ule

on S

tand

ards

for

the

Dis

clos

ure

Doc

umen

t an

d Buy

er's

Gui

de t

o in

clud

e la

ngua

ge in

the

upd

ated

201

3 N

AIC

Buy

er’s

Gui

de t

o Ann

uitie

s. U

ntil

that

tim

e, t

he I

nsur

ance

D

epar

tmen

t w

ill a

llow

insu

rers

and

pro

duce

rs t

o us

e ei

ther

the

ve

rsio

n cu

rren

tly b

eing

use

d or

the

rec

ently

upd

ated

NAI

C B

uyer

's

Gui

de.

Ann

uity

Tra

inin

g N

otic

e

X

Dat

ed:

1/11

/12

Not

ice

stat

es t

hat

the

4 ho

ur a

nnui

ty t

rain

ing

requ

irem

ent

for

prod

ucer

s se

lling

ann

uitie

s is

now

app

licab

le t

o re

side

nt a

nd

nonr

esid

ent

prod

ucer

s. T

he I

nsur

ance

Dep

artm

ent

will

allo

w a

90

day

grac

e pe

riod

for

non

resi

dent

pro

duce

rs t

o co

mpl

y. T

hose

pr

oduc

ers

who

hav

e sa

tisfie

d an

ann

uity

tra

inin

g re

quirem

ent

in

anot

her

stat

e w

ith s

ubst

antia

lly s

imila

r pr

ovis

ions

as

the

Okl

ahom

a ru

le w

ill b

e de

emed

to

satis

fy t

he O

klah

oma

requ

irem

ent,

acc

ordi

ng

to t

he n

otic

e.

OK A

dmin

. Cod

e §3

65:2

5-17

-2

X

Effe

ctiv

e: 7

/14/

10

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 41

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

28

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Rul

e 36

5:25

+

X

Effe

ctiv

e: 7

/14/

09

Th

e ru

le a

men

ds p

rovi

sion

s on

sta

ndar

ds for

det

erm

inin

g if

an

insu

ranc

e co

mpa

ny is

in a

haz

ardo

us fin

anci

al c

ondi

tion,

re

quirem

ents

for

pre

paid

fun

eral

ben

efits

, co

nver

sion

fro

m t

rust

to

insu

ranc

e fu

nded

con

trac

ts,

com

mis

sion

er’s

aut

hority

, an

d vi

atic

al

sett

lem

ent

licen

sing

and

rep

ortin

g re

quirem

ents

. Add

s a

new

re

gula

tion

on t

he u

se o

f se

nior

-spe

cific

cer

tific

atio

ns a

nd

prof

essi

onal

des

igna

tions

in t

he s

ale

of li

fe in

sura

nce

and

annu

ities

an

d ne

w s

ectio

ns o

n vi

atic

al s

ettle

men

t st

anda

rds

for

eval

uatio

n of

re

ason

able

pay

men

ts for

ter

min

ally

ill i

nsur

eds,

adv

ertis

ing

filin

g re

quirem

ents

, pr

ohib

ited

prac

tices

, in

sura

nce

com

pany

pra

ctic

es,

and

the

tran

sitio

n pe

riod

for

exi

stin

g lic

ense

s. A

lso

revo

kes

Sub

chap

ter

13 o

n th

e re

gula

tion

of li

fe s

ettle

men

ts a

nd a

dds

new

ap

pend

ices

for

a r

equi

red

broc

hure

and

for

ms

for

viat

ical

se

ttle

men

ts.

OK R

ule

365:

25-1

9-5

X

Ef

fect

ive:

09/

15/1

4.

Am

ends

ann

uity

dis

clos

ure

prov

isio

ns t

hat

requ

ire

insu

rers

to

use

the

buye

r's

guid

e fo

und

in A

ppen

dix

S by

rev

okin

g App

endi

x S a

nd

inst

ead

requ

irin

g in

sure

rs t

o us

e th

e m

ost

curr

ent

vers

ion

of t

he

NAIC

Buy

er's

Gui

de t

o Ann

uitie

s.

Rul

e 36

5:25

-19-

1

X

Ado

pted

200

6.

Sim

ilar

to t

he N

AIC

Ann

uity

Dis

clos

ure

Mod

el.

OR

EGO

N

Rul

e 83

6-08

0-01

70+

X

Reg

. Ef

fect

ive:

7/1

/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Rul

e 83

6-08

0-01

60

X

Effe

ctiv

e: 1

1/1/

09

Esta

blis

hes

crite

ria

to s

afeg

uard

con

sum

ers

from

dec

eptiv

e an

d di

shon

est

mar

ketin

g pr

actic

es.

It p

rovi

des

prot

ectio

n re

latin

g to

the

us

e of

dis

tinct

ive

desc

ript

ions

and

cer

tific

atio

ns in

the

sol

icita

tion,

tr

ansa

ctio

n or

acq

uisi

tion

of, or

cou

nsel

mad

e, c

once

rnin

g an

in

sura

nce

prod

uct

or in

offer

ing

advi

ce a

s to

the

val

ue o

f or

the

su

itabi

lity

of p

urch

asin

g in

sura

nce.

The

ado

pted

rul

e go

es b

eyon

d th

e N

AIC m

odel

and

app

lies

to a

ll de

sign

atio

ns,

not

just

tho

se u

sed

in t

he s

enio

r m

arke

t.

OAR

836

-080

-009

0

Ado

pted

200

4.

Gen

eral

sui

tabi

lity

stan

dard

s no

t ba

sed

on N

AIC S

enio

r Pr

otec

tion

Mod

el.

OAR

836

-051

-090

0

X

Ef

fect

ive:

8/1

5/08

Th

e In

sura

nce

Div

isio

n ha

s st

arte

d a

rule

mak

ing

proc

ess

to a

dopt

th

e Ann

uity

Dis

clos

ure

Mod

el b

y ru

le.

A r

ulem

akin

g ad

viso

ry

com

mitt

ee m

eetin

g w

ill b

e he

ld 5

/5.

PEN

NS

YLV

AN

IA

40 P

A Con

s. S

tat.

Ann

. §6

27-2

X

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 42

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

29

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Adm

in.

Cod

e tit

. 31

§§

85.

38 t

o 85

.39

Ado

pted

197

8.

Var

iatio

n of

the

NAIC

Ann

uity

Dis

clos

ure

Mod

el a

ddre

ssin

g va

riab

le

annu

ity a

nd v

aria

ble

accu

mul

atio

n an

nuity

con

trac

ts.

RH

OD

E IS

LAN

D

Reg

. 41

ACLI

Com

men

ts

X

Ef

fect

ive

02/1

8/14

.

Bring

s ru

le in

to c

ompl

ianc

e w

ith t

he N

AIC m

odel

act

. In

clud

es

requ

irin

g a

new

Buy

er's

Gui

de,

addi

ng a

new

sec

tion

desc

ribi

ng t

he

crite

ria

for

annu

ity il

lust

ratio

ns a

nd a

ugm

entin

g th

e es

sent

ials

ne

cess

ary

in t

he d

iscl

osur

e do

cum

ent.

Reg

. Sec

uriti

es 5

01-1

X

Effe

ctiv

e: 1

/13/

11

Reg

ulat

ion

esta

blis

hes

stan

dard

s an

d re

quirem

ents

for

the

use

of

seni

or s

peci

fic c

ertif

icat

ions

and

des

igna

tions

in t

he o

ffer

, sa

le,

or

purc

hase

of

secu

ritie

s. T

he r

egul

atio

n is

sub

stan

tially

sim

ilar

to t

he

NAIC

Mod

el R

egul

atio

n on

the

Use

of Sen

ior-

Spe

cific

Cer

tific

atio

ns

and

Prof

essi

onal

Des

igna

tion

with

the

exc

eptio

n of

cer

tain

sty

listic

dr

aftin

g ch

ange

s.

RI

AD

C 1

1-5-

12:3

X

Reg

. Ef

fect

ive:

1/2

0/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Bul

letin

201

1-02

X

Dat

ed:

4/22

/11

Effe

ctiv

e: 6

/1/1

1 D

etai

ls p

rodu

cer

trai

ning

req

uire

men

ts for

ann

uity

sui

tabi

lity

prio

r to

th

e sa

le,

solic

itatio

n, o

r ne

gotia

tion

of p

olic

ies

or c

ontr

acts

, ef

fect

ive

June

1, 20

11. In

clud

es d

etai

ls o

n co

urse

app

rova

l, ho

urs

of t

rain

ing

requ

ired

, ev

iden

ce o

f co

mpl

ianc

e w

ith t

rain

ing

requ

irem

ents

, an

d re

cord

ret

entio

n.

Reg

. 41

X

Ef

fect

ive:

9/3

0/09

Th

e ne

w r

egul

atio

n st

ipul

ates

the

min

imum

info

rmat

ion

that

is

requ

ired

to

be d

iscl

osed

and

the

man

ner

for

disc

losi

ng it

rel

atin

g to

th

e sa

le o

f an

nuity

con

trac

ts. It

mak

es c

erta

in t

hat

cons

umer

s co

mpr

ehen

d sp

ecifi

c es

sent

ial a

ttribu

tes

of a

nnui

ty c

ontr

acts

and

is

base

d on

the

NAI

C m

odel

.

Reg

. 11

2

X

Effe

ctiv

e: 5

/26/

09

Bas

ed o

n th

e N

AIC m

odel

, th

e ne

w r

egul

atio

n on

sen

ior

spec

ifica

tions

was

ado

pted

to

offe

r co

ntin

uity

with

oth

er s

tate

s. I

t es

tabl

ishe

s cr

iteria

to p

rote

ct c

onsu

mer

s fr

om d

ecep

tive

mar

ketin

g pr

actic

es c

once

rnin

g th

e us

e of

sen

ior-

spec

ific

cert

ifica

tions

and

pr

ofes

sion

al d

esig

natio

ns in

the

pur

chas

e, s

olic

itatio

n, s

ale

or a

dvic

e m

ade

in c

onne

ctio

n w

ith li

fe in

sura

nce

or a

nnui

ty p

rodu

cts.

SO

UTH

CA

RO

LIN

A

Reg

. 69

-29

X

Reg

. Ef

fect

ive:

9/2

5/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Ins.

Reg

. 69

-39

Ado

pted

198

6.

Old

er v

ersi

on o

f th

e N

AIC A

nnui

ty D

iscl

osur

e M

odel

.

Reg

. 69

-40.

1

X

Effe

ctiv

e: 5

/28/

10

Bas

ed o

n th

e N

AIC m

odel

reg

ulat

ion,

est

ablis

hes

stan

dard

s an

d re

quirem

ents

for

the

use

of se

nior

-spe

cific

cer

tific

atio

ns a

nd

Pag

e 43

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

30

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

desi

gnat

ions

in t

he s

ale

of li

fe in

sura

nce

and

annu

ities

.

SO

UTH

DA

KO

TA

SD

Cod

ified

Law

s §5

8-33

A-

13 t

o 58

-33A

-27

X

Sig

ned

by G

over

nor:

2/

23/1

2 Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Rul

e 20

:08:

03

X*(

NAS

AA)

Effe

ctiv

e: 1

2/9/

10

Add

s ne

w r

ule

to p

rohi

bit

the

use

of s

enio

r sp

ecifi

c de

sign

atio

ns o

r ce

rtifi

catio

ns t

o im

ply

spec

ial t

rain

ing

or k

now

ledg

e w

hen

advi

sing

se

nior

citi

zens

or

retir

ees

abou

t in

vest

ing,

pur

chas

ing

or s

ellin

g se

curitie

s (a

dopt

s N

ASA

A M

odel

). A

lso

repl

aces

the

nam

e "N

atio

nal

Ass

ocia

tion

of S

ecur

ities

Dea

lers

" w

ith "

Fina

ncia

l Ind

ustr

y Reg

ulat

ory

Aut

hority

, In

c."

TEN

NES

SEE

Prop

osed

Reg

ulat

ion

0780

-01

-86-

.01

X

Th

e In

sura

nce

Dep

artm

ent

publ

ishe

d Pr

opos

ed R

egul

atio

n 07

80-0

1-86

-.01

on

Ann

uity

Sui

tabi

lity.

As

publ

ishe

d, t

he r

egul

atio

n de

viat

es

(PD

F) fro

m t

he m

odel

for

insu

ranc

e pr

oduc

er t

rain

ing

as it

doe

s no

t co

ntai

n a

six

mon

th g

race

per

iod.

ACLI

sub

mitt

ed a

com

men

t le

tter

(P

DF)

to

the

depa

rtm

ent

aski

ng t

hat

the

mod

el r

egul

atio

n la

ngua

ge

be u

sed

in T

enne

ssee

. A h

earing

on

the

regu

latio

n is

sch

edul

ed for

M

ay 5

at

9:00

a.m

.

*O

n M

ay 5

, th

e D

epar

tmen

t of

Com

mer

ce a

nd

In

sura

nce

hel

d

a h

eari

ng

on

pro

pose

d r

egu

lati

on,

07

80

-01

-86

, S

uit

abili

ty in

A

nn

uit

y Tr

ansa

ctio

ns.

AC

LI t

esti

fied

in s

upp

ort

of t

he

reg

ula

tion

, bu

t re

qu

este

d a

lead

tim

e fo

r co

mp

lian

ce o

f 6

m

on

ths

from

th

e ef

fect

ive

dat

e. T

he

reco

rd h

as b

een

left

o

pen

fo

r 2

wee

ks t

o al

low

for

add

itio

nal

com

men

ts.

Bul

letin

X

Dat

e: 5

/22/

13

On

May

22,

201

3, a

Bul

letin

was

issu

ed a

ddre

ssin

g qu

estio

ns a

risi

ng

from

Reg

. se

c. 0

780-

1-86

sui

tabi

lity

in a

nnui

ty t

rans

actio

ns.

The

depa

rtm

ent’s

insu

ranc

e an

d se

curitie

s di

visi

ons

join

tly a

utho

red

the

bulle

tin t

o pr

ovid

e gu

idan

ce t

o in

sura

nce

prod

ucer

s, in

vest

men

t ad

vise

rs,

inve

stm

ent

advi

ser

repr

esen

tativ

es a

nd b

roke

r-de

aler

ag

ents

abo

ut t

he p

erm

issi

ble

and

proh

ibite

d ac

tiviti

es o

f In

sura

nce-

Onl

y an

d Se

curitie

s-O

nly

pers

ons.

Th

e bu

lletin

fol

low

s Io

wa

Insu

ranc

e Bul

letin

11-

4, a

bul

letin

tha

t ha

d th

e ap

prov

al o

f in

dust

ry.

TN A

d Reg

078

0-01

-86+

X

Effe

ctiv

e: 7

/6/0

8 Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

TEX

AS

Ann

uity

Tra

inin

g

Th

e D

epar

tmen

t of

Ins

uran

ce (

TDI)

has

tak

en a

ctio

n to

upd

ate

and

exte

nd r

ecip

roci

ty o

n ag

ents

' ann

uity

tra

inin

g to

all

stat

es t

hat

have

ad

opte

d th

e N

AIC S

uita

bilit

y in

Ann

uity

Tra

nsac

tions

Mod

el

Pag

e 44

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

31

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Reg

ulat

ion

(NAI

C m

odel

). A

fter

Tex

as e

nact

ed t

he N

AIC m

odel

th

roug

h le

gisl

atio

n in

201

1, T

DI

only

ack

now

ledg

ed a

bout

18

stat

es

as b

eing

rec

ipro

cal a

nd la

gged

in u

pdat

ing

its w

ebsi

te t

o ad

d st

ates

th

at s

ubse

quen

tly a

dopt

ed t

he N

AIC m

odel

. O

utre

ach

by A

CLI

and

TA

LHI

over

the

pas

t ye

ar p

rom

pted

TD

I to

rev

ise

its w

eb p

age

on

July

11,

201

4 to

rem

ove

the

listin

g of

sta

tes

and

inst

ead

prov

ide

that

a T

exas

res

iden

t or

non

-res

iden

t ag

ent

may

mee

t th

e Te

xas

annu

ity in

itial

tra

inin

g re

quirem

ent

by h

avin

g co

mpl

eted

an

initi

al

trai

ning

cou

rse

that

has

bee

n ap

prov

ed in

Tex

as o

r in

a s

tate

tha

t is

al

so c

ompl

iant

with

the

Nat

iona

l Ass

ocia

tion

of I

nsur

ance

Com

mis

sion

ers

(NAIC

) an

nuity

tra

inin

g m

odel

req

uire

men

ts.

TX I

ns.

Cod

e Ann

. §1

115.

003

X

Sig

ned

by t

he G

over

nor:

6/

17/1

1 Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Rul

e 28

TAC

3.9

701+

X

Ef

fect

ive:

3/1

/11

Ado

pts

annu

ity d

iscl

osur

e ru

les

that

req

uire

insu

rers

pro

vide

spe

cific

di

sclo

sure

s to

bot

h an

nuity

app

lican

ts a

nd a

nnui

ty c

ontr

act

owne

rs.

The

annu

ity d

iscl

osur

e ru

le d

evia

tes

from

the

NAI

C m

odel

reg

ulat

ion

and

follo

ws

the

subs

tanc

e of

H.

1293

, w

hich

pas

sed

during

the

200

9 le

gisl

ativ

e se

ssio

n bu

t w

as v

etoe

d by

Gov

erno

r Pe

rry

beca

use

the

bill

cont

aine

d a

priv

ate

righ

t of

act

ion.

The

rul

es a

re a

pplic

able

to

annu

ity t

rans

actio

ns t

hat

occu

r on

or

afte

r th

e da

te t

hat

is s

ix

mon

ths

afte

r th

e ef

fect

ive

date

of

the

rule

. [

Ed. N

ote:

Ple

ase

see

the

2/15

/11

Sta

te N

ews

Flas

h fo

r ad

ditio

nal i

nfor

mat

ion.

]

H.

1294

X

Sig

ned

by t

he g

over

nor

6/19

/09

As

enac

ted,

rel

ates

to

the

use

of s

enio

r-sp

ecifi

c ce

rtifi

catio

ns a

nd

prof

essi

onal

des

igna

tions

in t

he s

ale

of li

fe in

sura

nce

and

annu

ities

.

Follo

ws

the

NAI

C S

enio

r D

esig

natio

ns a

nd P

rofe

ssio

nal C

ertif

icat

ions

M

odel

Reg

ulat

ion.

Als

o in

clud

es a

gent

edu

catio

n re

quirem

ents

in

the

sale

of an

nuity

pro

duct

s an

d ap

plic

able

onl

y to

res

iden

t ag

ents

.

Prov

ides

an

April 1

, 20

10 c

ompl

ianc

e da

te for

the

age

nt c

ontinu

ing

educ

atio

n re

quirem

ents

. E

ffec

tive

date

is S

epte

mbe

r 1,

and

app

lies

only

to

the

solic

itatio

n of

, sa

le o

f, o

r ad

vice

mad

e in

con

nect

ion

with

, a

life

insu

ranc

e or

ann

uity

pro

duct

by

an in

sura

nce

agen

t on

or

afte

r Ja

nuar

y 1,

201

0.

H.

4492

X

Sig

ned

by G

ov:

6/19

/09

Ef

fect

ive:

9/1

/09.

Cha

pter

N

o. 1

093

As

enac

ted,

am

ends

the

sui

tabi

lity

law

to

addr

ess

annu

ities

re

gist

ered

und

er t

he S

ecur

ities

Act

of 19

33 a

nd u

pdat

e re

fere

nce

from

NASD

to

FIN

RA.

Pag

e 45

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

32

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

UTA

H

Rul

e R59

0-22

9-4+

X

Ef

fect

ive:

3/1

1/14

Am

endm

ents

to

the

annu

ity d

iscl

osur

e ru

le u

pdat

e th

e in

corp

orat

ed

NAIC

Ann

uity

Buy

er's

Gui

de t

o th

e 20

13 v

ersi

ons.

The

rev

ised

Buy

er's

Gui

des

incl

ude

annu

ities

in g

ener

al,

fixed

ann

uitie

s an

d va

riab

le a

nnui

ties

as w

ell a

s de

ferr

ed a

nnui

ty,

defe

rred

ann

uity

fix

ed a

nd d

efer

red

annu

ity v

aria

ble

buye

r's

guid

es.

The

Insu

ranc

e D

epar

tmen

t ha

s am

ende

d Reg

ulat

ion

R59

0-22

9-9

to

exte

nd t

he e

nfor

cem

ent

date

fro

m 4

5 da

ys a

fter

the

reg

ulat

ion’

s ef

fect

ive

date

to

65 d

ays

afte

r th

e re

gula

tion’

s ef

fect

ive

date

. Th

e ef

fect

ive

date

of

the

regu

latio

n is

May

27,

201

4.

Rul

e R59

0-23

0-1+

X

Rul

e Ef

fect

ive:

3/2

6/12

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

R59

0-25

2

X

Effe

ctiv

e: 2

/25/

09

The

new

rul

e in

stitu

tes

crite

ria

for

usin

g se

nior

-spe

cific

cer

tific

atio

ns

and

prof

essi

onal

des

igna

tions

by

insu

ranc

e pr

oduc

ers

and

cons

ulta

nts,

bro

ker-

deal

ers

and

inve

stm

ent

advi

sors

in t

he s

ale

of

life

insu

ranc

e, a

nnui

ties,

and

acc

iden

t an

d he

alth

pro

duct

s.

R59

0-22

9-1

X

Ado

pted

200

4.

VER

MO

NT

Reg

. SI

-11-

03

X

Effe

ctiv

e: 9

/1/1

1 Ado

pted

rul

e pr

ohib

its t

he u

se o

f se

nior

spe

cific

-cer

tific

atio

ns a

nd

desi

gnat

ions

to

impl

y sp

ecia

l tra

inin

g or

kno

wle

dge

in t

he o

ffer

, sa

le,

or p

urch

ase

of s

ecur

ities

or

insu

ranc

e, o

r in

pro

vidi

ng

inve

stm

ent

advi

ce r

egar

ding

sec

uriti

es o

r in

sura

nce.

Ado

pts

a si

mila

r ve

rsio

n of

the

NAI

C M

odel

Reg

ulat

ion

on t

he U

se o

f Se

nior

-Spe

cific

Cer

tific

atio

ns a

nd P

rofe

ssio

nal D

esig

natio

ns.

H.

222

X*

Sig

ned

by G

over

nor

6/1/

09.

This

act

sha

ll ta

ke

effe

ct o

n Ju

ly 1

, 20

09,

exce

pt t

hat

Secs

. 1,

2,

and

5 of

thi

s ac

t sh

all t

ake

effe

ct J

anua

ry 1

, 20

10.

Cre

ates

new

law

aut

horizi

ng t

he C

omm

issi

oner

of Bus

ines

s,

Insu

ranc

e, S

ecur

ities

and

Hea

lth C

are

Adm

inis

trat

ion

(BIS

HCA)

to

exte

nsiv

ely

regu

late

life

set

tlem

ents

, w

hile

spe

cific

ally

pro

hibi

ting

stra

nger

-origi

nate

d lif

e in

sura

nce

(STO

LI)

tran

sact

ions

. A

utho

rize

s BIS

HCA

to a

dopt

rul

es t

hat

wou

ld g

over

n cr

eden

tials

, ce

rtifi

catio

ns,

and

desi

gnat

ions

of th

ose

hold

ing

them

selv

es o

ut a

s po

sses

sing

sp

ecia

l lev

els

of e

xper

tise

rega

rdin

g se

nior

inve

stm

ents

.

VT

Sta

t. A

nn.

Tit.

8

§472

4(16

) X

N

on m

odel

, su

itabi

lity

prov

isio

n.

VIR

GIN

IA

Reg

14

VAC 5

-43-

10+

X

Effe

ctiv

e: 5

/15/

09

The

new

reg

ulat

ion,

whi

ch c

lose

ly fol

low

s th

e N

AIC m

odel

Pag

e 46

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

33

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

regu

latio

n, e

stab

lishe

s st

anda

rds

and

requ

irem

ents

for

the

use

of

seni

or-s

peci

fic c

ertif

icat

ions

and

des

igna

tions

by

insu

ranc

e ag

ents

in

the

mar

ketin

g, s

ale,

or

purc

hase

of a

life

or a

ccid

ent

and

heal

th

insu

ranc

e po

licy,

or

annu

ity p

rodu

cts.

App

licab

ility

incl

udes

the

m

arke

ting,

sal

e, o

r pu

rcha

se o

f di

sabi

lity

inco

me

insu

ranc

e po

licie

s,

long

-ter

m c

are

insu

ranc

e po

licie

s, lo

ng-t

erm

car

e pa

rtne

rshi

p po

licie

s, a

nd fix

ed a

nd v

aria

ble

annu

ities

.

14 V

AC 5

-30-

10+

Ado

pted

: 20

06.

Effe

ctiv

e: 4

/1/0

7 Li

fe I

nsur

ance

and

Ann

uity

Rep

lace

men

ts

14 V

A A

dmin

. Cod

e §5

-45-

10

X

Ado

pted

: 20

06.

Effe

ctiv

e: 4

/1/0

7.

Sim

ilar

to t

he 2

006

NAIC

Sui

tabi

lity

Mod

el.

WA

SH

ING

TON

Rul

e 28

4-17

-265

and

Rul

e 28

4-23

-390

ACLI

Com

men

ts

X

Rul

e Ef

fect

ive:

3/2

9/12

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Rul

e 28

4-17

-605

ACLI

Com

men

ts

X

Effe

ctiv

e: 3

/16/

12

New

rul

e es

tabl

ishe

s st

anda

rds

and

requ

irem

ents

for

the

use

of

seni

or-s

peci

fic c

ertif

icat

ions

and

des

igna

tions

in t

he s

ale

of li

fe

insu

ranc

e an

d an

nuiti

es,

sim

ilar

to t

he N

AIC M

odel

.

Adm

in.

Cod

e R. §§

284

-23-

300

to 2

84-2

3-38

0

Ado

pted

198

0.

Old

er v

ersi

on o

f th

e N

AIC A

nnui

ty D

iscl

osur

e M

odel

.

S.

5671

X

Sig

ned

by g

over

nor

3/30

/09.

Cha

pter

18.

Ef

fect

ive

7/26

/09

Req

uire

s th

at a

nnui

ties

sold

in t

he s

tate

be

appr

opriat

e fo

r th

e ag

e an

d fin

anci

al s

ituat

ion

of t

he o

wne

r. S

ets

fort

h va

riou

s re

quirem

ents

fo

r in

sure

rs a

nd p

rodu

cers

con

cern

ing

the

sale

of an

nuiti

es.

Req

uire

s th

e Com

mis

sion

er t

o ad

opt

by r

ule,

ann

uity

sui

tabi

lity

stan

dard

s, u

pon

revi

ewin

g st

anda

rds

prev

ious

ly e

stab

lishe

d by

the

N

AIC

and

oth

er s

tate

s. I

nclu

des

the

Miti

gatio

n of

Res

pons

ibili

ty

sect

ion

of t

he N

AIC m

odel

and

upd

ates

the

FIN

RA s

afe

harb

or

lang

uage

to

refe

r to

"re

gist

ered

" an

nuiti

es.

Req

uire

s th

e Com

mis

sion

er t

o no

tify

the

Legi

slat

ure

if a

chan

ge is

mad

e in

the

ty

pes

of a

nnui

ties

subj

ect

to r

egis

trat

ion

unde

r th

e Sec

uriti

es A

ct o

f 19

33. (S

ame

as H

. 15

63)

WES

T V

IRG

INIA

S.

187

S.

189

X

Ef

fect

ive:

02/

28/2

015

Sen

ate

Bill

187

was

sig

ned

into

law

on

Mar

ch 5

, 20

15.

The

bill

auth

oriz

es t

he a

dopt

ion

of r

ulem

akin

g pu

t fo

rwar

d by

the

offic

e of

th

e in

sura

nce

com

mis

sion

er in

201

4, w

hich

pro

vide

s fo

r th

e

Pag

e 47

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

34

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

H.

2334

A

CLI

Com

men

t Le

tter

adop

tion

of t

he N

AIC 2

012

Indi

vidu

al A

nnui

ty R

eser

ve T

able

(20

12

IAR t

able

) an

d th

e re

vise

d N

AIC A

nnui

ty D

iscl

osur

e M

odel

Reg

ulat

ion.

Sin

ce t

hese

rul

es w

ere

plac

ed in

a b

undl

ed b

ill w

hich

in

clud

es o

ther

age

ncy

rule

s, t

he b

ill c

onta

ins

an “

effe

ctiv

e im

med

iate

ly u

pon

pass

age”

man

date

. ACLI

con

tact

ed t

he o

ffic

e of

th

e in

sura

nce

com

mis

sion

er’s

gen

eral

cou

nsel

and

was

adv

ised

tha

t in

the

se s

ituat

ions

the

off

ices

hav

e en

tert

aine

d a

phas

e-in

per

iod

for

com

plia

nce

whi

ch is

som

etim

es p

rovi

ded

by in

form

atio

nal l

ette

r or

fu

rthe

r di

rect

ives

at

a la

ter

date

. Th

e de

part

men

t in

dica

ted

that

th

ey a

re o

pen

to s

ugge

stio

ns a

nd c

omm

ents

. ACLI

will

be

subm

ittin

g co

mm

ents

thi

s w

eek

requ

estin

g a

dela

yed

effe

ctiv

e da

te

for

the

annu

ity d

iscl

osur

e ru

le.

*As

prev

ious

ly r

epor

ted,

S. 18

7 w

as s

igne

d in

to la

w o

n M

arch

5,

2015

. Th

e bi

ll au

thor

izes

the

ado

ptio

n of

rul

emak

ing

put

forw

ard

by

the

Offic

es o

f th

e In

sura

nce

Com

mis

sion

er (

OIC

) in

201

4, w

hich

pr

ovid

es for

the

ado

ptio

n of

the

NAI

C 2

012

Indi

vidu

al A

nnui

ty

Res

erve

Tab

le (

2012

IAR

tab

le)

and

the

revi

sed

NAI

C A

nnui

ty

Dis

clos

ure

Mod

el R

egul

atio

n. S

ince

the

se r

ules

wer

e pl

aced

in a

bu

ndle

d bi

ll w

hich

incl

udes

oth

er a

genc

y ru

les,

the

bill

con

tain

s an

"e

ffec

tive

imm

edia

tely

upo

n pa

ssag

e" m

anda

te.

How

ever

, th

e ac

tual

ef

fect

ive

date

for

eac

h of

the

rul

es w

as u

ltim

atel

y de

pend

ent

on t

he

OIC

fin

al f

iling

of th

e ru

les

with

the

Sec

reta

ry o

f Sta

te.

Sho

rtly

aft

er

the

bill

was

ena

cted

, AC

LI s

ubm

itted

a c

omm

ent

lett

er r

eque

stin

g a

dela

yed

effe

ctiv

e da

te for

the

ann

uity

dis

clos

ure

rule

in o

rder

to

prov

ide

mem

ber

com

pani

es w

ith a

dequ

ate

lead

tim

e to

dev

elop

and

im

plem

ent

the

proc

edur

es a

nd s

yste

ms

chan

ges

nece

ssar

y to

co

mpl

y w

ith t

he r

ule.

O

n Ap

ril 2

4, b

oth

rule

s w

ere

final

file

d w

ith t

he S

ecre

tary

of Sta

te

with

Jul

y 23

, 20

15 e

ffec

tive

date

s.

Prop

osed

Rul

e 11

4-11

E-1+

Com

men

t Le

tter

X

Com

men

t D

ate:

07/

24/1

4 Th

e pr

opos

ed a

men

dmen

ts t

o th

e an

nuity

dis

clos

ure

rule

, ba

sed

on

the

2011

-am

ende

d N

AIC A

nnui

ty D

iscl

osur

e M

odel

Reg

ulat

ion,

w

ould

incl

ude

addi

ng a

new

sec

tion

on s

tand

ards

for

ann

uity

ill

ustr

atio

ns,

addi

ng t

o th

e "n

on a

pplic

abili

ty"

list,

add

ing

new

de

finiti

ons

and

renu

mbe

ring

the

sec

tion

on r

epor

t to

con

trac

t ow

ners

. Th

ey a

lso

wou

ld in

clud

e re

mov

ing

the

appe

ndic

es o

n Eq

uity

-Ind

exed

Ann

uitie

s an

d Buy

er's

Gui

de,

and

repl

acin

g th

em

with

an

Ann

uity

Illu

stra

tion

Exam

ple.

Rul

e 11

4-11

B X

Reg

. Ef

fect

ive:

7/1

/11

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Rul

e 11

4-89

X

Effe

ctiv

e: 7

/1/1

0

Esta

blis

hes

stan

dard

s an

d re

quirem

ents

for

the

use

of se

nior

-sp

ecifi

c ce

rtifi

catio

ns a

nd p

rofe

ssio

nal d

esig

natio

ns in

the

sal

e of

life

Pag

e 48

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

35

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Rul

e 11

4-11

E S.4

07

X X

X

Effe

ctiv

e: 7

/16/

10

Sig

ned

by G

over

nor:

4/2

/10

Effe

ctiv

e: 3

/13/

10

insu

ranc

e an

d an

nuiti

es.

(NAIC

Sen

ior

Des

igna

tions

Mod

el)

Esta

blis

hes

requ

irem

ents

for

the

dis

clos

ure

of in

form

atio

n in

rel

atio

n to

the

sal

e of

ann

uity

con

trac

ts. In

clud

es r

equi

rem

ents

for

the

co

nten

t of

the

dis

clos

ure

docu

men

t an

d th

e Buy

er's

Gui

de.

(NAIC

Ann

uity

Dis

clos

ure

Mod

el)

Th

is b

ill a

dopt

s va

riou

s re

gula

tions

, in

clud

ing

Ann

uity

Dis

clos

ure

(Pro

p. R

ule

114-

11E)

and

Use

of Sen

ior

Des

igna

tion

(Pro

p. R

ule

114-

89).

Whi

le t

he le

gisl

atio

n its

elf

is e

ffec

tive,

ACLI

is w

orki

ng w

ith

the

Insu

ranc

e D

epar

tmen

t on

effec

tive

date

s fo

r th

e Rul

es.

Cod

e of

Sta

te R

ules

§ 1

14-

11-6

(g)

Ado

pted

197

4.

Gen

eral

sui

tabi

lity

stan

dard

not

bas

ed o

n th

e N

AIC S

uita

bilit

y M

odel

.

WIS

CO

NS

IN

Prop

osed

Rul

e AD

C I

ns

2.14

+

X

The

Off

ice

of t

he C

omm

issi

oner

of In

sura

nce

publ

ishe

d Pr

opos

ed

Rul

e AD

C I

ns 2

.14+

tha

t w

ould

allo

w in

sure

rs a

nd a

gent

s to

use

the

m

ost

curr

ent

vers

ion

of t

he a

pplic

able

NAI

C B

uyer

's G

uide

for

D

efer

red

Ann

uitie

s, t

here

by d

isco

ntin

uing

use

of th

e ou

tdat

ed

Wis

cons

in B

uyer

's G

uide

to

Ann

uitie

s.

The

hear

ing

for

the

prop

osed

re

gula

tion

is s

ched

uled

for

Jan

uary

23

and

com

men

ts a

re d

ue b

y Fe

brua

ry 6

.

Ann

uitie

s Buy

ers

Gui

de

X

The

Off

ice

of t

he C

omm

issi

oner

of In

sura

nce

(OCI)

inte

nds

to

upda

te it

s Buy

ers

Gui

de for

Ann

uitie

s by

impl

emen

ting

the

NAIC

ve

rsio

n th

at w

as r

evis

ed in

201

3. W

isco

nsin

cur

rent

ly h

as it

s ow

n Buy

ers

Gui

de a

nd s

uch

a pr

opos

al (

PDF)

wou

ld m

ake

this

gui

de

obso

lete

. Th

e O

CI

is r

eque

stin

g da

ta fro

m in

sure

rs r

egar

ding

fin

anci

al im

pact

to

insu

rers

as

the

NAI

C r

equi

res

a 35

cen

t fe

e fo

r ea

ch g

uide

dis

trib

uted

by

a co

mpa

ny t

o a

Wis

cons

in r

esid

ent.

ACLI

m

embe

r co

mpa

nies

may

pro

vide

suc

h da

ta t

o th

e O

CI

dire

ctly

or

to

ACLI

.

WI

Sta

t. A

nn. §6

28.3

47

X

Sig

ned

by G

over

nor:

5/

13/1

0

Sim

ilar

to t

he 2

010

NAIC

Sui

tabi

lity

Mod

el.

Pag

e 49

of A

ppen

dix

ACLI

Iss

ue S

tatu

s Cha

rt

NAIC

Ann

uity

Dis

clos

ure,

Sui

tabi

lity

& S

enio

r D

esig

natio

ns

Page

36

of 3

8 pa

ges

© A

mer

ican

Cou

ncil

of L

ife I

nsur

ers,

101

Con

stitu

tion

Ave

nue,

NW

, W

ashi

ngto

n, D

.C.

2000

1-2

133.

All

righ

ts r

eser

ved.

Leg

isla

tive

or

Reg

ula

tory

Cit

atio

n

Su

itab

ilit

y M

odel

An

nu

ity

Dis

clos

ure

M

odel

Sen

ior

Des

ign

atio

n

Sta

tus

Com

men

ts

Rul

e In

s. 6

.90

X

Effe

ctiv

e: 1

/1/1

0 Th

e ne

w r

ule

crea

tes

crite

ria

to s

hiel

d co

nsum

ers

from

dec

eitf

ul

prac

tices

with

res

pect

to

the

use

of s

enio

r-sp

ecifi

c ce

rtifi

catio

ns a

nd

prof

essi

onal

des

igna

tions

in t

he a

dver

tisin

g, s

olic

itatio

n, s

ale

or

purc

hase

of lif

e in

sura

nce,

ann

uity

pro

duct

s or

hea

lth in

sura

nce.

It

follo

ws

clos

ely

the

NAI

C m

odel

with

tw

o di

scre

panc

ies.

The

new

rul

e ad

ds a

dver

tisin

g to

the

list

of pr

actic

es a

nd c

ondu

ct,

and

heal

th

insu

ranc

e to

the

list

of pr

oduc

ts t

o w

hich

the

rul

e ap

plie

s.

S.

294

X

Sig

ned

by g

over

nor

3/26

/08.

Effec

tive

3/28

/08

exce

pt for

fol

low

ing

sect

ions

: In

sura

nce

Form

Fi

ling

is e

ffec

tive

7/1/

08 a

nd

Sui

tabi

lity

of A

nnui

ties

is

effe

ctiv

e 10

/1/0

8.

Enac

ts t

he N

AIC I

nter

stat

e In

sura

nce

Prod

uct

Reg

ulat

ion

Com

pact

w

ith s

light

dev

iatio

ns.

Am

ends

the

sui

tabi

lity

of a

nnui

ty s

ales

st

atut

es t

o m

ake

them

app

ly t

o co

nsum

ers

of a

ll ag

es,

not

just

to

a pe

rson

65

or o

lder

. Th

is m

akes

the

sta

tute

con

sist

ent

with

the

NAI

C

Sui

tabi

lity

in A

nnui

ty T

rans

actio

ns M

odel

Reg

ulat

ion.

Pro

vide

s th

at,

with

a n

umbe

r of

spe

cifie

d ex

cept

ions

, a

form

first

use

d on

or

afte

r th

e ef

fect

ive

date

of th

e pr

ovis

ion

that

has

not

alrea

dy b

een

filed

by

that

dat

e m

ay b

e us

ed w

ithou

t ap

prov

al b

y th

e co

mm

issi

oner

. Th

e sp

ecifi

ed e

xcep

tions

, w

hich

mus

t st

ill b

e fil

ed a

nd a

ppro

ved

befo

re

use,

incl

ude,

am

ong

othe

rs, fo

rms

for

long

-ter

m c

are

insu

ranc

e. T

he

Com

mitt

ee m

et o

n 4/

22 a

nd h

eard

pre

sent

atio

ns fro

m J

im M

umfo

rd

of t

he I

owa

Dep

artm

ent,

IM

SA,

and

FIN

RA

rega

rdin

g th

eir

activ

ities

on

sui

tabi

lity.

Th

e Com

mitt

ee h

as r

ecen

tly b

een

give

n th

e ta

sk o

f de

velo

ping

bas

elin

e su

perv

isio

n st

anda

rds

for

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written statement standards of suitability See

not unsuitable after reasonable inquiry

Id.

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See

Page 53 of Appendix

Id.

formal action of its board of directors

Page 54 of Appendix

three basic areas of ideal suitability

perceived

perceived

persistency See

expressed insurance objectives and needs

reasonable objectives and needs

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See

See

Page 55 of Appendix

As a result, persistency will be less and less relevant as a measure of suitability.

formally adopt

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See

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Page 56 of Appendix

See

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contain questions designed to elicit suitability information from applicants See

See

Page 57 of Appendix

Page 58 of Appendix

Page 59 of Appendix

Page 60 of Appendix

Page 61 of Appendix

face-to-face meeting

other than in a face-to-face meeting

direct solicitation through the mail

2. For applications received via the Internet:

Extended Free-Look Period

Page 62 of Appendix

at least annually

Page 63 of Appendix

Buyer’s Guide for

DeferredAnnuitiesDeferredAnnuities

Page 64 of Appendix

NAIC Buyer’s Guide for Deferred Annuities

It’s important that you understand how annuities can be different from each other so you can choose the type of annuity that’s best for you. The purpose of this Buyer’s Guide is to help you do that. This Buyer’s Guide isn’t meant to offer legal, financial, or tax advice. You may want to consult independent advisors that specialize in these areas.

This Buyer’s Guide is about deferred annuities in general and some of their most common features. It’s not about any particular annuity product. The annuity you select may have unique features this Guide doesn’t describe. It’s important for you to carefully read the material you’re given or ask your annuity salesperson, especially if you’re interested in a particular annuity or specific annuity features.

This Buyer’s Guide includes questions you should ask the insurance company or the annuity salesperson (the agent, producer, broker, or advisor). Be sure you’re satisfied with the answers before you buy an annuity.

Page 65 of Appendix

Buyer’s Guide for Deferred Annuities

© 2013 National Association of Insurance Commissioners

Tab

le o

f C

on

ten

ts

Table of Contents

What Is an Annuity? ........................................................................................ 1 When Annuities Start to Make Income Payments ...................................................................1

How Deferred Annuities Are Alike ..........................................................................................1

How Deferred Annuities Are Different ....................................................................................2

How Does the Value of a Deferred Annuity Change? ........................................ 3 Fixed Annuities .........................................................................................................................3

Fixed Indexed Annuities ...........................................................................................................3

Variable Annuities .....................................................................................................................4

What Other Information Should You Consider? ............................................... 4 Fees, Charges, and Adjustments ................................................................................................4

How Annuities Make Payments ...............................................................................................5

How Annuities Are Taxed ........................................................................................................6

Finding an Annuity That’s Right for You ..................................................................................6

Questions You Should Ask .......................................................................................................7

When You Receive Your Annuity Contract ..............................................................................7

Page 66 of Appendix

Buyer’s Guide for Deferred Annuities

© 2013 National Association of Insurance Commissioners1

Wh

at I

s an

An

nu

ity?

What Is an Annuity?

An annuity is a contract with an insurance company. All annuities have one feature in common, and it makes annuities different from other financial products. With an annuity, the insurance company promises to pay you income on a regular basis for a period of time you choose—including the rest of your life.

When Annuities Start to Make Income Payments

Some annuities begin paying income to you soon after you buy it (an immediate annuity). Others begin at some later date you choose (a deferred annuity).

How Deferred Annuities Are Alike

There are ways that most deferred annuities are alike.

They have an accumulation period and a payout period. During the accumulation period, the value of your annuity changes based on the type of annuity. During the payout period, the annuity makes income payments to you.

They offer a basic death benefit. If you die during the accumulation period, a deferred annuity with a basic death benefit pays some or all of the annuity’s value to your survivors (called beneficiaries) either in one payment or multiple payments over time. The amount is usually the greater of the annuity account value or the minimum guaranteed surrender value. If you die after you begin to receive income payments (annuitize), your chosen survivors may not receive

anything unless: 1) your annuity guarantees to pay out at least as much as you paid into the annuity, or 2) you chose a payout option that continues to make payments after your death. For an extra cost, you may be able to choose enhanced death benefits that increase the value of the basic death benefit.

You usually have to pay a charge (called a surrender or withdrawal charge) if you take some or all of your money out too early (usually before a set time period ends). Some annuities may not charge if you withdraw small amounts (for example, 10% or less of the account value) each year.

Any money your annuity earns is tax deferred. That means you won’t pay income tax on earnings until you take them out of the annuity.

You can add features (called riders) to many annuities, usually at an extra cost.

An annuity salesperson must be licensed by your state insurance department. A person selling a variable annuity also must be registered with FINRA1 as a representative of a broker/dealer that’s a FINRA member. In some states, the state securities department also must license a person selling a variable annuity.

1. FINRA (Financial Industry Regulatory Authority) regulates the companies and salespeople who sell variable annuities.

Sources of Information

Contract: The legal document between you and the insurance company that binds both of you to the terms of the agreement.

Disclosure: A document that describes the key features of your annuity, including what is guaranteed and what isn’t, and your annuity’s fees and charges. If you buy a variable annuity, you’ll receive a prospectus that includes detailed information about investment objectives, risks, charges, and expenses.

Illustration: A personalized document that shows how your annuity features might work. Ask what is guaranteed and what isn’t and what assumptions were made to create the illustration.

Page 67 of Appendix

Buyer’s Guide for Deferred Annuities

© 2013 National Association of Insurance Commissioners 2

Wh

at I

s an

An

nu

ity?

Insurance companies sell annuities. You want to buy from an insurance company that’s financially sound. There are various ways you can research an insurance company’s financial strength. You can visit the insurance company’s website or ask your annuity salesperson for more information. You also can review an insurance company’s rating from an independent rating agency. Four main firms currently rate insurance companies. They are A.M. Best Company, Standard and Poor’s Corporation, Moody’s Investors Service, and Fitch Ratings. Your insurance department may have more information about insurance companies. An easy way to find contact information for your insurance department is to visit www.naic.org and click on “States and Jurisdictions Map.”

Insurance companies usually pay the annuity salesperson after the sale, but the payment doesn’t reduce the amount you pay into the annuity. You can ask your salesperson how they earn money from the sale.

How Deferred Annuities Are Different

There are differences among deferred annuities. Some of the differences are:

Whether you pay for the annuity with one or more than one payment (called a premium).

The types and amounts of the fees, charges, and adjustments. While almost all annuities have some fees and charges that could reduce your account value, the types and amounts can be different among annuities. Read the Fees, Charges, and Adjustments section in this Buyer’s Guide for more information.

Whether the annuity is a fixed annuity or a variable annuity. How the value of an annuity changes is different depending on whether the annuity is fixed or variable.

Fixed annuities guarantee your money will earn at least a minimum interest rate. Fixed annuities may earn interest at a rate higher than the minimum but only the minimum rate is guaranteed. The insurance company sets the rates.

Fixed indexed annuities are a type of fixed annuity that earns interest based on changes in a market index, which measures how the market or part of the market performs. The interest rate is guaranteed to never be less than zero, even if the market goes down.

Variable annuities earn investment returns based on the performance of the investment portfolios, known as “subaccounts,” where you choose to put your money. The return earned in a variable annuity isn’t guaranteed. The value of the subaccounts you choose could go up or down. If they go up, you could make money. But, if the value of these subaccounts goes down, you could lose money. Also, income payments to you could be less than you expected.

premium bonus, which usually is a lump sum amount the insurance company adds to your annuity when you buy it or when you add money. It’s usually a set percentage of the amount you put into the annuity. Other annuities offer an interest bonus, which is an amount the insurance company adds to your annuity when you earn interest. It’s usually a set percentage of the interest earned. You may not be able to withdraw some or all of your premium bonus for a set period of time. Also, you could lose the bonus if you take some or all of the money out of your annuity within a set period of time.

Page 68 of Appendix

Buyer’s Guide for Deferred Annuities

© 2013 National Association of Insurance Commissioners3

Val

ue

of a

Def

erre

d A

nn

uit

yHow Does the Value of a Deferred Annuity Change?

Fixed Annuities

Money in a fixed deferred annuity earns interest at a rate the insurer sets. The rate is fixed (won’t change) for some period, usually a year. After that rate period ends, the insurance company will set another fixed interest rate for the next rate period. That rate could be higher or lower than the earlier rate.

Fixed deferred annuities do have a guaranteed minimum interest rate—the lowest rate the annuity can earn. It’s stated in your contract and disclosure and can’t change as long as you own the annuity. Ask about:

initial interest rate – What is the rate? How long until it will change?renewal interest rate – When will it be announced? How will the insurance

company tell you what the new rate will be?

Fixed Indexed Annuities

Money in a fixed indexed annuity earns interest based on changes in an index. Some indexes are measures of how the overall financial markets perform (such as the S&P 500 Index or Dow Jones Industrial Average) during a set period of time (called the index term). Others measure how a specific financial market performs (such as the Nasdaq) during the term. The insurance company uses a formula to determine how a change in the index affects the amount of interest to add to your annuity at the end of each index term. Once interest is added to your annuity for an index term, those earnings usually are locked in and changes in the index in the next index term don’t affect them. If you take money from an indexed annuity before an index term ends, the annuity may not add all of the index-linked interest for that term to your account.

Insurance companies use different formulas to calculate the interest to add to your annuity. They look at changes in the index over a period of time. See the box “Fixed Deferred Indexed Formulas” that describes how changes in an index are used to calculate interest.

The formulas insurance companies use often mean that interest added to your annuity is based on only part of a change in an index over a set period of time. Participation rates, cap rates, and spread rates (sometimes called margin or asset fees) all are terms that describe ways the amount of interest added to your annuity may not reflect the full change in the index. But if the index goes down over that period, zero interest is added to your annuity. Then your annuity value won’t go down as long as you don’t withdraw the money.

When you buy an indexed annuity, you aren’t investing directly in the market or the index. Some indexed annuities offer you more than one index choice. Many indexed annuities also offer the choice to put part of your money in a fixed interest rate account, with a rate that won’t change for a set period.

Fixed Deferred Indexed Formulas

Annual Point-to-Point – Change in index calculated using two dates one year apart.

Multi-Year Point-to-Point – Change in index calculated using two dates more than one year apart.

Monthly or Daily Averaging – Change in index calculated using multiple dates (one day of every month for monthly averaging, every day the market is open for daily averaging). The average of these values is compared with the index value at the start of the index term.

Monthly Point-to-Point – Change in index calculated for each month during the index term. Each monthly change is limited to the “cap rate” for positive changes, but not when the change is negative. At the end of the index term, all monthly changes (positive and negative) are added. If the result is positive, interest is added to the annuity. If the result is negative or zero, no interest (0%) is added.

Page 69 of Appendix

Buyer’s Guide for Deferred Annuities

© 2013 National Association of Insurance Commissioners 4

Fee

s, C

har

ges,

an

d A

dju

stm

ents

Variable Annuities

Money in a variable annuity earns a return based on the performance of the investment portfolios, known as “subaccounts,” where you choose to put your money. Your investment choices likely will include subaccounts with different types and levels of risk. Your choices will affect the return you earn on your annuity. Subaccounts usually have no guaranteed return, but you may have a choice to put some money in a fixed interest rate account, with a rate that won’t change for a set period.

The value of your annuity can change every day as the subaccounts’ values change. If the subaccounts’ values increase, your annuity earns money. But there’s no guarantee that the values of the subaccounts will increase. If the subaccounts’ values go down, you may end up with less money in your annuity than you paid into it.

An insurer may offer several versions of a variable deferred annuity product. The different versions usually are identified as share classes. The key differences between the versions are the fees you’ll pay every year you own the annuity. The rules that apply if you take money out of the annuity also may be different. Read the prospectus carefully. Ask the annuity salesperson to explain the differences among the versions.

What Other Information Should You Consider?

Fees, Charges, and Adjustments

Fees and charges reduce the value of your annuity. They help cover the insurer’s costs to sell and manage the annuity and pay benefits. The insurer may subtract these costs directly from your annuity’s value. Most annuities have fees and charges but they can be different for different annuities. Read the contract and disclosure or prospectus carefully and ask the annuity salesperson to describe these costs.

A surrender or withdrawal charge is a charge if you take part or all of the money out of your annuity during a set period of time. The charge is a percentage of the amount you take out of the annuity. The percentage usually goes down each year until the surrender charge period ends. Look at the contract and the disclosure or prospectus for details about the charge. Also look for any waivers for events (such as a death) or the right to take out a small amount (usually up to 10%) each year without paying the charge. If you take all of your money out of an annuity, you’ve surrendered it and no longer have any right to future income payments.

Some annuities have a Market Value Adjustment (MVA). An MVA could increase or decrease your annuity’s account value, cash surrender value, and/or death benefit value if you withdraw money from your account. In general, if interest rates are lower when you

How Insurers Determine

Indexed Interest

Participation Rate – Determines how much of the increase in the index is used to calculate index-linked interest. A participation rate usually is for a set period. The period can be from one year to the entire term. Some companies guarantee the rate can never be lower (higher) than a set minimum (maximum). Participation rates are often less than 100%, particularly when there’s no cap rate.

Cap Rate – Typically, the maximum rate of interest the annuity will earn during the index term. Some annuities guarantee that the cap rate will never be lower (higher) than a set minimum (maximum). Companies often use a cap rate, especially if the participation rate is 100%.

Spread Rate – A set percentage the insurer subtracts from any change in the index. Also called a “margin or asset fee.” Companies may use this instead of or in addition to a participation or cap rate.

Page 70 of Appendix

Buyer’s Guide for Deferred Annuities

© 2013 National Association of Insurance Commissioners

withdraw money than they were when you bought the annuity, the MVA could increase the amount you could take from your annuity. If interest rates are higher than when you bought the annuity, the MVA could reduce the amount you could take from your annuity. Every MVA calculation is different. Check your contract and disclosure or prospectus for details.

How Annuities Make Payments

Annuitize

At some future time, you can choose to annuitize your annuity and start to receive guaranteed fixed income payments for life or a period of time you choose. After payments begin, you can’t take any other money out of the annuity. You also usually can’t change the amount of your payments. For more information, see “Payout Options” in this Buyer’s Guide. If you die before the payment period ends, your survivors may not receive any payments, depending on the payout option you choose.

Full Withdrawal

You can withdraw the cash surrender value of the annuity in a lump sum payment and end your annuity. You’ ll likely pay a charge to do this if it’s during the surrender charge period. If you withdraw your annuity’s cash surrender value, your annuity is cancelled. Once that happens, you can’t start or continue to receive regular income payments from the annuity.

Partial Withdrawal

You may be able to withdraw some of the money from the annuity’s cash surrender value without ending the annuity. Most annuities with surrender charges let you take out a certain amount (usually up to 10%) each year without paying surrender charges on that amount. Check your contract and disclosure or prospectus. Ask your annuity salesperson about other ways you can take money from the annuity without paying charges.

Living Benefits for Fixed Annuities

Some fixed annuities, especially fixed indexed annuities, offer a guaranteed living benefits rider, usually at an extra cost. A common type is called a guaranteed lifetime withdrawal benefit that guarantees to make income payments you can’t outlive. While you get payments, the money still in your annuity continues to earn interest. You can choose to stop and restart the payments or you might be able to take extra money from your annuity. Even if the payments reduce the annuity’s value to zero at some point, you’ll continue to get payments for the rest of your life. If you die while receiving payments, your survivors may get some or all of the money left in your annuity.

5

How

An

nu

itie

s M

ake

Pay

men

ts

Annuity Fees and Charges

Contract fee percentage charged once or annually.

Percentage of purchase payment – A front-end sales load or other charge deducted from each premium paid. The percentage may vary over time.

Premium tax – A tax some states charge on annuities. The insurer may subtract the amount of the tax when you pay your premium, when you withdraw your contract value, when you start to receive income payments, or when it pays a death

Transaction fee – A charge for certain transactions, such as transfers or withdrawals.

* * *Mortality and expense (M&E) risk charge – A fee charged on variable annuities. It’s a percentage of the account value invested in subaccounts.

Underlying fund charges – Fees and charges on a variable annuity’s subaccounts; may include an investment management fee, distribution and service (12b-1) fees, and other fees.

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© 2013 National Association of Insurance Commissioners 6

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Living Benefits for Variable Annuities

Variable annuities may offer a benefit at an extra cost that guarantees you a minimum account value, a minimum lifetime income, or minimum withdrawal amounts regardless of how your subaccounts perform. See “Variable Annuity Living Benefit Options” at right. Check your contract and disclosure or prospectus or ask your annuity salesperson about these options.

How Annuities Are Taxed

Ask a tax professional about your individual situation. The information below is general and should not be considered tax advice.

Current federal law gives annuities special tax treatment. Income tax on annuities is deferred. That means you aren’t taxed on any interest or investment returns while your money is in the annuity. This isn’t the same as tax-free. You’ll pay ordinary income tax when you take a withdrawal, receive an income stream, or receive each annuity payment. When you die, your survivors will typically owe income taxes on any death benefit they receive from an annuity.

There are other ways to save that offer tax advantages, including Individual Retirement Accounts (IRAs). You can buy an annuity to fund an IRA, but you also can fund your IRA other ways and get the same tax advantages. When you take a withdrawal or receive payments, you’ll pay ordinary income tax on all of the money you receive (not just the interest or the investment return). You also may have to pay a 10% tax penalty if you withdraw money before you’re age 59½.

Finding an Annuity That’s Right for You

An annuity salesperson who suggests an annuity must choose one that they think is right for you, based on information from you. They need complete information about your life and financial situation to make a suitable recommendation. Expect a salesperson to ask about your age; your financial situation (assets, debts, income, tax status, how you plan to pay for the annuity); your tolerance for risk; your financial objectives and experience; your family circumstances; and how you plan to use the annuity. If you aren’t comfortable with the annuity, ask your annuity salesperson to explain why they recommended it. Don’t buy an annuity you don’t understand or that doesn’t seem right for you.

Variable Annuity Living

Benefit Options

Guaranteed Minimum Accumulation Benefit (GMAB) – Guarantees your account value will equal some percentage (typically 100%) of premiums less withdrawals, at a set future date (for example, at maturity). If your annuity is worth less than the guaranteed amount at that date, your insurance company

Guaranteed Minimum Income Benefit (GMIB) – Guarantees a minimum lifetime income. You usually

buy the annuity and must annuitize

a waiting period before you can

Guaranteed Lifetime Withdrawal Benefit (GLWB) – Guarantees you can make withdrawals for the rest of your life, up to a set maximum percentage each year.

Payout Options

You’ll have a choice about how to receive income payments. These choices usually include:

lifetime or your spouse’s lifetime

lifetime or a set time period

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Buyer’s Guide for Deferred Annuities

© 2013 National Association of Insurance Commissioners7

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ouWithin each annuity, the insurer may guarantee some values but not others. Some guarantees may be only for a year or less while others could be longer. Ask about risks and decide if you can accept them. For example, it’s possible you won’t get all of your money back or the return on your annuity may be lower than you expected. It’s also possible you won’t be able to withdraw money you need from your annuity without paying fees or the annuity payments may not be as much as you need to reach your goals. These risks vary with the type of annuity you buy. All product guarantees depend on the insurance company’s financial strength and claims-paying ability.

Questions You Should Ask

achieve that goal if the income from the annuity isn’t as much as I expected it to be?

appropriate for me?

such as 401(k)s, 403(b)s, and IRAs?

paying a surrender charge? Is there a limit on the total amount I can withdraw during the surrender charge period?

any surrender charges?

will affect my tax liability?

payment from my annuity if I die?

If you don’t know the answers or have other questions, ask your annuity salesperson for help.

When You Receive Your Annuity Contract

When you receive your annuity contract, carefully review it. Be sure it matches your understanding. Also, read the disclosure or prospectus and other materials from the insurance company. Ask your annuity salesperson to explain anything you don’t understand. In many states, a law gives you a set number of days (usually 10 to 30 days) to change your mind about buying an annuity after you receive it. This often is called a free look or right to return period. Your contract and disclosure or prospectus should prominently state your free look period. If you decide during that time that you don’t want the annuity, you can contact the insurance company and return the contract. Depending on the state, you’ll either get back all of your money or your current account value.

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BUYER’S GUIDE TOFIXED DEFERRED ANNUITIESWITHAPPENDIX FOR EQUITY-INDEXEDANNUITIES

Page 75 of Appendix

Prepared by theNAIC

National Association of Insurance Commissioners

The National Association of Insurance Commissioners is anassociation of state insurance regulatory officials. This association helps the various insurance departments to

coordinate insurance laws for the benefit of all consumers.

This guide does not endorse any company or policy.

Reprinted by....

©1999 National Association of Insurance Commissioners

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1

IT ISIMPORTANT

That you understand the differences among various annuities so you canchoose the kind that best fits your needs. This guide focuses on fixeddeferred annuity contracts. There is, however, a brief description of vari-able annuities. If you're thinking of buying an equity-indexed annuity, anappendix to this guide will give you specific information. This Guideisn't meant to offer legal, financial or tax advice. You may want to con-sult independent advisors. At the end of this Guide are questions youshould ask your agent or the company. Make sure you're satisfied withthe answers before you buy.

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WHAT ISAN ANNUITY?

An annuity is a contract in which an insurance company makes a series ofincome payments at regular intervals in return for a premium or premiumsyou have paid. Annuities are most often bought for future retirement income.Only an annuity can pay an income that can be guaranteed to last as long asyou live.

An annuity is neither a life insurance nor a health insurance policy. It's not asavings account or a savings certificate. You shouldn't buy an annuity toreach short-term financial goals.

Your value in an annuity contract is the premiumsyou've paid, less any applicable charges, plus inter-est credited. The insurance company uses the valueto figure the amount of most of the benefits thatyou can choose to receive from an annuity contract.This guide explains how interest is credited as wellas some typical charges and benefits of annuitycontracts.

A deferred annuity has two parts or periods.During the accumulation period, the money you putinto the annuity, less any applicable charges, earnsinterest. The earnings grow tax-deferred as long asyou leave them in the annuity. During the secondperiod, called the payout period, the company paysincome to you or to someone you choose.

WHAT ARE THE DIFFERENT KINDS OF ANNUITIES?

This guide explains major differences in different kinds of annuities to helpyou understand how each might meet your needs. But look at the specificterms of an individual contract you're considering and the disclosure docu-ment you receive. If your annuity is being used to fund or provide benefitsunder a pension plan, the benefits you get will depend on the terms of theplan. Contact your pension plan administrator for information.

This Buyer’s Guide will focus on individual fixed deferred annuities.2

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SINGLE PREMIUM OR MULTIPLE PREMIUMYou pay the insurance company only one payment for a single premiumannuity. You make a series of payments for a multiple premium annuity.There are two kinds of multiple premium annuities. One kind is a flexiblepremium contract. Within set limits, you pay as much premium as youwant, whenever you want. In the other kind, a scheduled premium annuity,the contract spells out your payments and how often you'll make them.

IMMEDIATE OR DEFERREDWith an immediate annuity, income payments start no later than one yearafter you pay the premium. You usually pay for an immediate annuity withone payment.

The income payments from a deferred annuity often start many years later.Deferred annuities have an accumulation period, which is the time betweenwhen you start paying premiums and when income payments start.

FIXED OR VARIABLEFixed

During the accumulation period of a fixed deferred annuity, your money(less any applicable charges) earns interest at rates set by the insurancecompany or in a way spelled out in the annuity contract. The companyguarantees that it will pay no less than a minimum rate of interest. Duringthe payout period, the amount of each income payment to you is generallyset when the payments start and will not change.

VariableDuring the accumulation period of a variable annuity, the insurance compa-ny puts your premiums (less any applicable charges) into a separateaccount. You decide how the company will invest those premiums, depend-ing on how much risk you want to take. You may put your premium into astock, bond or other account, with no guarantees, or into a fixed account,with a minimum guaranteed interest. During the payout period of a variableannuity, the amount of each income payment to you may be fixed (set at thebeginning) or variable (changing with the value of the investments in theseparate account).

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HOW ARE THE INTEREST RATES SET FOR MY FIXED DEFERRED ANNUITY?

During the accumulation period, your money (less any applicable charges)earns interest at rates that change from time to time. Usually, what theserates will be is entirely up to the insurance company.

CURRENT INTEREST RATEThe current rate is the rate the company decides to credit to your contract ata particular time. The company will guarantee it will not charge for sometime period.

The initial rate is an interest rate the insurance company may credit for aset period of time after you first buy your annuity. The initial rate in somecontracts may be higher than it will be later. This is often called a bonusrate.

The renewal rate is the rate credited by the company after the end of theset time period. The contract tells how the company will set the renewalrate, which may be tied to an external reference or index.

MINIMUM GUARANTEED RATEThe minimum guaranteed interest rate is the lowest rate your annuity willearn. This rate is stated in the contract.

MULTIPLE INTERESTRATESSome annuity contracts apply differ-ent interest rates to each premiumyou pay or to premiums you pay dur-ing different time periods.

Other annuity contracts may havetwo or more accumulated values thatfund different benefit options. Theseaccumulated values may use differ-ent interest rates. You get only oneof the accumulated values dependingon which benefit you choose.

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WHAT CHARGES MAY BE SUBTRACTED FROM MYFIXED DEFERRED ANNUITY?

Most annuities have charges related to the cost of selling or servicing it.These charges may be subtracted directly from the contract value. Ask youragent or the company to describe the charges that apply to your annuity.Some examples of charges, fees and taxes are:

SURRENDER OR WITHDRAWAL CHARGESIf you need access to your money, you may be able to take all or part of thevalue out of your annuity at any time during the accumulation period. If youtake out part of the value, you may pay a withdrawal charge. If you take outall of the value and surrender, or terminate, the annuity, you may pay a sur-render charge. In either case, the company may figure the charge as a per-centage of the value of the contract, of the premiums you've paid or of theamount you're withdrawing. The company may reduce or even eliminate thesurrender charge after you've had the contract for a stated number of years. Acompany may waive the surrender charge when it pays a death benefit.

Some annuities have stated terms. When the term is up, the contract mayautomatically expire or renew. You're usually given a short period of time,called a window, to decide if you want to renew or surrender the annuity. Ifyou surrender during the window, you won't have to pay surrender charges. Ifyou renew, the surrender or withdrawal charges may start over.

In some annuities, there is no charge if you surrender your contract when thecompany's current interest rate falls below a certain level. This may be calleda bail-out option.

In a multiple-premium annuity, the surrender charge may apply to each pre-mium paid for a certain period of time. This may be called a rolling surren-der or withdrawal charge.

Some annuity contracts have a market value adjustment feature. If interestrates are different when you surrender your annuity than when you bought it,a market value adjustment may make the cash surrender value higher orlower. Since you and the insurance company share this risk, an annuity withan MVA feature may credit a higher rate than an annuity without the feature.

Be sure to read the Tax Treatment section and ask your tax advisor for infor-mation about possible tax penalties on withdrawals.

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FREE WITHDRAWALYour annuity may have a limited free withdrawal feature. That lets you make one or more withdrawals without a charge. The size of the free withdrawal is often limited toa set percentage of your contract value. Ifyou make a larger withdrawal, you may paywithdrawal charges. You may lose any inter-est above the minimum guaranteed rate onthe amount withdrawn. Some annuitieswaive withdrawal charges in certain situa-tions, such as death, confinement in a nursinghome or terminal illness.

CONTRACT FEEA contract fee is a flat dollar amount charged either once or annually.

TRANSACTION FEEA transaction fee is a charge per premiumpayment or other transaction.

PERCENTAGE OF PREMIUM CHARGEA percentage of premium charge is a charge deducted from each premiumpaid. The percentage may be lower after the contract has been in force for acertain number of years or after total premiums paid have reached a certainamount.

PREMIUM TAXSome states charge a tax on annuities. The insurance company pays this taxto the state. The company may subtract the amount of the tax when you payyour premium, when you withdraw you contract value, when you start toreceive income payments or when it pays a death benefit to your benefici-ary.

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WHAT ARE SOME FIXED DEFERRED ANNUITY CONTRACT BENEFITS?

ANNUITY INCOME PAYMENTSOne of the most important benefits of deferred annuities is your ability touse the value built up during the accumulation period to give you a lumpsum payment or to make income payments during the payout period.Income payments are usually made monthly but you may choose to receivethem less often. The size of income payments is based on the accumulatedvalue in your annuity and the annuity's benefit rate in effect when incomepayments start. The benefit rate usually depends on your age and sex, andthe annuity payment option you choose. For example, you might choosepayments that continue as long as you live, as long as your spouse lives orfor a set number of years.

There is a table of guaranteed benefitrates in each annuity contract. Mostcompanies have current benefit rates aswell. The company can change the cur-rent rates at any time, but the currentrates can never be less than the guaran-teed benefit rates. When income pay-ments start, the insurance companygenerally uses the benefit rate in effectat the time to figure the amount of yourincome payment.

Companies may offer various incomepayment options. You (the owner) oranother person that you name maychoose the option. The options aredescribed here as if the payments aremade to you.

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Life OnlyThe company pays income for your lifetime. Itdoesn't make any payments to anyone after youdie. This payment option usually pays the high-est income possible. You might choose it if youhave no dependents, if you have taken care ofthem through other means or if the dependantshave enough income of their own.

Life Annuity with Period CertainThe company pays income for as long as you liveand guarantees to make payments for a set num-ber of years even if you die. This period certainis usually 10 or 20 years. If you live longer thanthe period certain, you’ll continue to receive pay-ments until you die. If you die during the periodcertain, your beneficiary gets regular paymentsfor the rest of that period. If you die after theperiod certain, your beneficiary doesn't receiveany payments from your annuity. Because the"period certain" is an added benefit,each incomepayment will be smaller than in a life-onlyoption.

Joint and SurvivorThe company pays income as long as either you or your beneficiary lives.You may choose to decrease the amount of the payments after the firstdeath. You may also be able to choose to have payments continue for a setlength of time. Because the survivor feature is an added benefit, eachincome payment is smaller than in a life-only option.

DEATH BENEFITIn some annuity contracts, the company may pay a death benefit to yourbeneficiary if you die before the income payments start. The most commondeath benefit is the contract value or the premiums paid, whichever is more.

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CAN MY ANNUITY'S VALUEBE DIFFERENT DEPENDING ON MY CHOICE OF BENEFIT?

While all deferred annuities offer a choice of benefits, some use differentaccumulated values to pay different benefits. For example, an annuity mayuse one value if annuity payments are for retirement benefits and a differentvalue if the annuity is surrendered . As another example, an annuity may useone value for long-term care benefits and a different value if the annuity issurrendered. You can't receive more than one benefit at the same time.

WHAT ABOUT THETAX TREATMENT OF ANNUITIES?

Below is a general discussion about taxes and annuities. You should consulta professional tax advisor to discuss your individual tax situation.

Under current federal law, annuities receive special tax treatment. Income taxon annuities is deferred, which means you aren't taxed on the interest yourmoney earns while it stays in the annuity. Tax-deferred accumulation isn'tthe same as tax-free accumulation. An advantage of tax deferral is that thetax bracket you're in when you receive annuity income payments may belower than the one you're in during the accumulation period. You'll also beearning interest on the amount you would have paid in taxes during the accu-mulation period. Most states' tax laws on annuities follow the federal law.

Part of the payments you receive from annuity will be considered as a returnof the premium you've paid. You won't have to pay taxes on that part.Another part of the payments is considered interest you've earned. You mustpay taxes on the part that is considered interest when you withdraw themoney. You may also have to pay a 10% tax penalty if you draw the accu-mulation before age 59 ½. The Internal Revenue Code also has rules aboutdistributions after the death of a contract holder.

Annuities used to fund certain employee pension benefit plans (those underInternal Revenue Code Sections 401(a), 401(k), 403(b), 457 or 414) defertaxes on plan contributions as well as on interest or investment income.Within the limits set by the law, you can use pretax dollars to make paymentsto the annuity. When you take money out, it will be taxed.

You can also use annuities to fund traditional and Roth IRAs under InternalRevenue Code Section 408. If you buy an annuity to fund an IRA, you'llreceive a disclosure statement describing the tax treatment. 9

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WHAT IS A"FREE LOOK" PROVISION?

Many states have laws which give you a set number of days to look at the annu-ity contract after you buy it. If you decide during that time that you don't wantthe annuity, you can return the contract and get all your money back. This isoften referred to as a free look or right to return period. The free look periodshould be prominently stated in your contract. Be sure to read your contractcarefully during the free look period.

HOW DO I KNOWIF A FIXED DEFERRED ANNUITY IS RIGHT FOR ME?

The questions listed below may help you decide which type of annuity, if any,meets your retirement planning and financial needs. You should think aboutwhat your goals are for the money you may put into the annuity. You need tothink about how much risk you're willing to take with the money. Ask your-self:

How much retirement income will I need in addi-tion to what I will get from Social Security and mypension?

Will I need that additional income only for myselfor for myself and someone else?

How long can I leave my money in the annuity?

When will I need income payments?

Does the annuity let me get money when I need it?

Do I want a fixed annuity with a guaranteed inter-est rate and little or no risk of losing the principal?

Do I want a variable annuity with the potential forhigher earnings that aren't guaranteed and the pos-sibility that I may risk losing principal?

Or, am I somewhere in between and willing totake some risks with an equity-indexed annuity?

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WHAT QUESTIONS SHOULD I ASK MY AGENT OR THE COMPANY?

Is this a single premium or multiple premiumcontract?

Is this an equity-indexed annuity?

What is the initial interest rate and how long isit guaranteed?

Does the initial rate include a bonus rate andhow much is the bonus?

What is the guaranteed minimum interest rate?

What renewal rate is the company crediting onannuity contracts of the same type that wereissued last year?

Are there withdrawal or surrender charges or penalties if I want to end mycontract early and take out all of my money? How much are they?

Can I get a partial withdrawal without paying surrender or other charges orlosing interest?

Does my annuity waive withdrawal charges for reasons such as death, con-finement in a nursing home or terminal illness?

Is there a market value adjustment (MVA) provision in my annuity?

What other charges, if any, may be deducted from my premium or contractvalue?

If I pick a shorter or longer payout period or surrender the annuity, will theaccumulated value or the way interest is credited change? Is there a deathbenefit? How is it set? Can it change?

What income payment options can I choose? Once I choose a paymentoption, can I change it?

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FINAL POINTS TO CONSIDER

Before you decide to buy an annuity, you should review the contract. Termsand conditions of each annuity contract will vary.

Ask yourself if, depending on your needs or age, this annuity is right foryou. Taking money out of an annuity may mean you must pay taxes. Also,while it's sometimes possible to transfer the value of an older annuity into anew annuity, the new annuity may have a new schedule of charges thatcould mean new expenses you must pay directly or indirectly.

You should understand the long-term nature of your purchase. Be sure youplan to keep an annuity long enough so that the charges don't take too muchof the money you put in. Be sure you understand the effect of all charges.

If you're buying an annuity to fund an IRA or other tax-deferred retirementprogram, be sure that you're eligible. Also, ask if there are any restrictionsconnected with the program.

Remember that the quality of service that youcan expect from the company and the agent is avery important factor in your decision.

When you receive you annuity contract, READIT CAREFULLY!! Ask the agent and companyfor an explanation of anything you don't under-stand. Do this before any free look periodends.

Compare information or similar contracts fromseveral companies. Comparing products mayhelp you make better decisions.

If you have a specific question or can't get answers you need from the agentor company, contact your state insurance department.

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APPENDIX IEQUITY-INDEXED ANNUITIES

This appendix to the Buyer's Guide for Fixed Deferred Annuities willfocus on equity-indexed annuities. Like other types of fixed deferredannuities, equity-indexed annuities provide for annuity income payments,death benefits and tax-deferred accumulation. You should read theBuyer's Guide for general information about those features and about pro-visions such as withdrawal and surrender charges.

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WHAT AREEQUITY-INDEXED ANNUITIES?

An equity-indexed annuity is afixed annuity, either immediateor deferred, that earns interestor provides benefits that arelinked to an external equityreference or an equity index.The value of the index mightbe tied to a stock or other equi-ty index. One of the mostcommonly used indices isStandard & Poor's 500Composite Stock Price Index(the S&P 500)1, which is anequity index. The value of anyindex varies from day to dayand is not predictable.

When you buy an equity-indexed annuity you own an insurance contract.You are not buying shares of any stock or index.

While immediate equity-indexed annuities may be available, this appendixwill focus on deferred equity-indexed annuities.

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HOW ARE THEY DIFFERENTFROM OTHER FIXED ANNUITIES?

An equity-indexed annuity isdifferent from other fixed annu-ities because of the way it cred-its interest to your annuity'svalue. Some fixed annuitiesonly credit interest calculated ata rate set in the contract. Otherfixed annuities also credit inter-est at rates set from time to timeby the insurance company.Equity-indexed annuities creditinterest using a formula basedon changes in the index to whichthe annuity is linked. The for-mula decides how the additionalinterest you get and when youget it depends on the features ofyour particular annuity.

Your equity-indexed annuity, like other fixed annuities also promises to paya minimum interest rate. The rate that will be applied will not be less thanthis minimum guaranteed rate even if the index-linked interest rate is lower.The value of your annuity also will not drop below a guaranteed minimum.For example, many single premium contracts guarantee the minimum valuewill never be less that 90 percent of the premium paid, plus at least 3% inannual interest (less any partial withdrawals). The guaranteed value is theminimum amount available during a term for withdrawals, as well as forsome annuitizations (see "Annuity Income Payments") and death benefits.The insurance company will adjust the value of the annuity at the end ofeach term to reflect any index increases.

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WHAT ARE SOMEEQUITY-INDEXED ANNUITYCONTRACT FEATURES?

Two features that have the greatest effect on the amount of additional inter-est that may be credited to an equity-indexed annuity are the indexingmethod and the participation rate. It is important to understand the featuresand how they work together. The following describes some other equity-indexed annuity features that affect the index-linked formula.

INDEXING METHODThe indexing method means the approach used to measure the amount ofchange, if any, in the index. Some of the most common indexing methods,which are explained more fully later on, include annual reset (ratcheting),high-water mark and point-to-point.

TERMThe index term is the period over which index-linked interest is calculated;the interest is credited to your annuity at the end of a term. Terms are gen-erally from one to ten years, with six or seven years being most common.Some annuities offer single terms while others offer multiple, consecutiveterms. If your annuity has multiple terms, there will usually be a window atthe end of each term, typically 30 days, during which you may withdrawyour money without penalty. For installment premium annuities, the pay-ment of each premium may begin a new term for that premium.

PARTICIPATION RATEThe participation rate decides how much of the increase in the index will beused to calculated index-linked interest. For example, if the calculatedchange in the index is 9% and the participation rate is 70%, the index linkedinterest rate for your annuity will be 6.3% (9% x 70% = 6.3%). A companymay set a different participation rate for newly issued annuities as often aseach day. Therefore, the initial participation rate in your annuity willdepend on when it is issued by the company. The company usually guaran-tees the participation rate for a specific period (from one year to the entireterm). When that period is over, the company sets a new participation ratefor the next period. Some annuities guarantee that the participation rate willnever be set lower than a specified minimum or higher than a specifiedmaximum.

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CAP RATE OR CAPSome annuities may put an upper limit, or cap, on the index-linked interestrate. This is the maximum rate of interest the annuity will earn. In theexample given above, if the contract has a 6% cap rate, 6%, and not 6.3%,would be credited. Not all annuities have a cap rate.

FLOOR ON EQUITY INDEX-LINKED INTERESTThe floor is the minimum index-linked interest rate you will earn. The mostcommon floor is 0%. A 0% floor assures that even if the index decreases invalue, the index-linked interest that you earn will be zero and not negative.As in the case of a cap, not all annuities have a stated floor on index-linkedinterest rates. But in all cases, your fixed annuity will have a minimumguaranteed value.

AVERAGINGIn some annuities, the average of anindex's value is used rather than the actu-al value of the index on a specified date.The index averaging may occur at thebeginning, the end, or throughout theentire term of the annuity.

INTEREST COMPOUNDINGSome annuities pay simple interest dur-ing an index term. That means index-linked interest is added to your originalpremium amount but does not compoundduring the term. Others pay compoundinterest during a term, which means thatindex-linked interest that has alreadybeen credited also earns interest in thefuture. In either case, however, the inter-est earned in one term is usually com-pounded in the next.

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MARGIN/SPREAD/ADMINISTRATIVE FEEIn some annuities, the index-linked interestrate is computed by subtracting a specificpercentage from any calculated change inthe index. This percentage, sometimesreferred to as the "margin," "spread," or"administrative fee," might be instead of, orin addition to, a participation rate. Forexample, if the calculated change in theindex is 10%, your annuity might specifythat 2.25% will be subtracted from the rateto determine the interest rate credited. Inthis example, the rate would be 7.75% (10%- 2.25% = 7.75%). In this example, thecompany subtracts the percentage only ifthe change in the index produces a positiveinterest rate.

VESTINGSome annuities credit none of the index-linked interest or only part of it, ifyou take out all your money before the end of the term. The percentage thatis vested, or credited, generally increases as the term comes closer to its endand is always 100% at the end of the term.

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HOW DO THECOMMON INDEXINGMETHODS DIFFER?

ANNUAL RESETIndex-linked interest, if any, is determined each year by comparing theindex value at the end of the contract year with the index value at the startof the contract year. Interest is added to your annuity each year during theterm.

HIGH-WATER MARKThe index-linked interest, if any, is decided by looking at the index value atvarious points during the term, usually the annual anniversaries of the dateyou bought the annuity. The interest is based on the difference between thehighest index value and the index value at the start of the term. Interest isadded to your annuity at the end of the term.

LOW-WATER MARKThe index-linked interest, if any, isdetermined by looking at the indexvalue at various points during the term,usually the annual anniversaries of thedate you bought the annuity. The inter-est is based on the difference betweenthe index value at the end of the termand the lowest index value. Interest isadded to your annuity at the end of theterm.

POINT-TO-POINTThe index-linked interest, if any, isbased on the difference between theindex value at the end of the term andthe index value at the start of the term.Interest is added to your annuity at theend of the term.

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WHAT ARE SOME OF THEFEATURES AND TRADE-OFFS OFDIFFERENT INDEXING METHODS?

ANNUAL RESETSince the interest earned is "locked in" annually and the index value is"reset" at the end of each year, future decreases in the index will not affectthe interest you have already earned. Therefore, your annuity using theannual reset method may credit more interest than annuities using othermethods when the index fluctuates up and down often during the term. Thisdesign is more likely than others to give you access to index-linked interestbefore the term ends.

HIGH-WATER MARKSince interest is calculated using the highest value of the index on a contractanniversary during the term, this design may credit higher interest thansome other designs if the index reaches a high point early or in the middleof the term, then drops off at the end of the term.

LOW-WATER MARKSince interest is calculated using the lowest value of the index prior to theend of the term, this design may credit higher interest than some otherdesigns if the index reaches a low point early or in the middle of the termand then rises at the end of the term.

POINT-TO-POINTSince interest cannot be calculated before the end of the term, use of thisdesign may permit a higher participation rate than annuities using otherdesigns.

FEATURES

Page 96 of Appendix

Generally, equity-indexed annuities offer preset combinations of features.You m ay have to make trade-offs to get features you want in an annuity.This means the annuity you chose may also have features you don’t want.

21

TRADE-OFFS

ANNUAL RESETYour annuity's participation rate may change each year and generally will belower than that of other indexing methods. Also an annual reset design mayuse a cap or averaging to limit the total amount of interest you might earneach year.

HIGH-WATER MARKInterest is not credited until the end of the term. In some annuities, if yousurrender your annuity before the end of the term, you may not get index-linked interest for that term. In other annuities, you may receive index-linked interest, based on the highest anniversary value to date and the annu-ity's vesting schedule. Also, contracts with this design may have a lowerparticipation rate than annuities using other designs or may use a cap tolimit the total amount of interest you might earn.

LOW-WATER MARKInterest is not credited until the end of the term. With some annuities, ifyou surrender your annuity before the end of the term, you may not getindex-linked interest for that term. In other annuities, you may receiveindex-linked interest based on a comparison of the lowest anniversary valueto date with the index value at surrender and the annuity's vesting schedule.Also, contracts with this design may have a lower participation rate thanannuities using other designs or may use a cap to limit the total amount ofinterest you might earn.

POINT-TO-POINTSince interest is not credited until the end of the term, typically six or sevenyears, you may not be able to get the index-linked interest until the end ofthe term.

Page 97 of Appendix

22

WHAT IS THEIMPACT OF SOME OTHEREQUITY-INDEXED ANNUITYPRODUCT FEATURES?

CAP ON INTEREST EARNEDWhile a cap limits the amount of interest you might earn each year, annu-ities with this feature may have other product features you want, such asannual interest crediting or the ability to take partial withdrawals. Also,annuities that have a cap may have a higher participation rate.

AVERAGINGAveraging at the beginning of a term protects you from buying your annuityat a high point, which would reduce the amount of interest you might earn.Averaging at the end of the term protects you against severe declines in theindex and losing index-linked interest as a result. On the other hand, aver-aging may reduce the amount of the index-linked interest you earn when theindex rises either near the start or at the end of the term.

PARTICIPATION RATEThe participation rate may vary greatly from one annuity to another andfrom time to time within a particular annuity. Therefore, it is important foryou to know how your annuity's participation rate works with the indexingmethod. A high participation rate may be offset by other features, such assimple interest, averaging, or a point-to-point indexing method. On theother hand, an insurance company may offset a lower participation rate byalso offering a feature such as an annual reset indexing method.

INTEREST COMPOUNDINGIt is important for you to know whether your annuity pays compound orsimple interest during a term. While you may earn less from an annuity thatpays simple interest, it may have other features you want, such as a highparticipation rate.

Page 98 of Appendix

WHAT WILL ITCOST ME TO TAKE MY MONEY OUT BEFORETHE END OF THE TERM?

In addition to the information discussed in this Buyer's Guide about surren-der and withdrawal charges and free withdrawals, there are additional con-siderations for equity-indexed annuities. Some annuities credit none of theindex-linked interest or only part of it if you take out money before the endof the term. The percentage that is vested, or credited, generally increasesas the term comes closer to its end and is always 100% at the end of theterm.

ARE DIVIDENDS INCLUDEDIN THE INDEX?

Depending on the indexused, stock dividendsmay or may not beincluded in the index'svalue. For example, theS&P 500 is a stock priceindex and only considersthe prices of stocks. Itdoes not recognize anydividends paid on thosestocks.

23

Page 99 of Appendix

24

HOW DO I KNOWIF AN EQUITY-INDEXEDANNUITY IS RIGHT FOR ME?

The questions listed belowmay help you decide whichtype of annuity, if any,meets your retirementplanning and financialneeds. You should consid-er what your goals are forthe money you may putinto the annuity. You needto think about how muchrisk you're willing to takewith the money. Ask your-self:

Am I interested in a vari-able annuity with thepotential for higher earn-ings that are not guaran-teed and willing to risk los-ing the principal?

Is a guaranteed interestrate more important to me,with little or no risk of los-ing the principal?

Or, am I somewhere inbetween these twoextremes and willing totake some risks?

Page 100 of Appendix

HOW DO I KNOWWHICH EQUITY-INDEXEDANNUITY IS BEST FOR ME?

As with any other insuranceproduct, you must carefullyconsider your own personalsituation and how you feelabout the choices available.No single annuity designmay have all the featuresyou want. It is important tounderstand the features andtrade-offs available so youcan choose the annuity thatis right for you. Keep inmind that it may be mislead-ing to compare one annuityto another unless you com-pare all the other features ofeach annuity. You mustdecide for yourself whatcombination of featuresmakes the most sense foryou. Also remember that itis not possible to predict thefuture behavior of an index.

25

Page 101 of Appendix

26

QUESTIONS YOU SHOULD ASKYOUR AGENT OR THE COMPANY

You should ask the following questions about equity-indexed annuities inaddition to the questions in the Buyer's Guide to Fixed Deferred Annuities.

How long is the term?

What is the guaranteed minimum interest rate?

What is the participation rate? For how long is the participation rate guar-anteed?

Is there a minimum participation rate?

Does my contract have an interest rate cap? What is it?

Does my contract have an interest rate floor? What is it?

Is interest rate averaging used? How does it work?

Is interest compounded duringa term?

Is there a margin, spread, oradministrative fee? Is that inaddition to or instead of a par-ticipation rate?

What indexing method is usedin my contract?

What are the surrender charges or penalties if I want to end my contractearly and take out all of my money?

Can I get a partial withdrawal without paying charges or losing interest?Does my contract have vesting? If so, what is the rate of vesting?

Page 102 of Appendix

FINAL POINTSTO CONSIDER

Remember to read yourannuity contract care-fully when you receiveit. Ask your agent orinsurance company toexplain anything youdon't understand. Ifyou have a specificcomplaint or can't getanswers you need fromthe agent or company,contact your stateinsurance department.

27

Page 103 of Appendix

system of supervision and control

capacity to monitor

sales material and illustrations are complete and accurate

Maintain records

Page 104 of Appendix

See

any

Purpose

Applies to Variable Life Insurance and Variable Annuity Replacements

replacement

Page 105 of Appendix

Exceptions

Page 106 of Appendix

Maintain a system of supervision and control

include at least

Inform its producers of the requirements of the regulation

producer training manuals

Provide a written statement of the company's position with respect to the acceptability of replacements

A system to review the appropriatenessthat the

producer does not indicate is in accord with the regulation’s standards;

confirm requirements met

detect transactions that are replacements of existing policies

Have the capacity to produce

records of each producer's

Replacements

Number of lapses

Page 107 of Appendix

unidentified replacements of existing policies

Replacements, indexed by replacing producer and existing insurer

Page 108 of Appendix

illustration or policy summary

note

indexed by producer, in its home or regional office

variable or market value adjustment policy or contract

internal replacements

financed purchases

Page 109 of Appendix

prohibits the use of sales material other than that approved

signed by the producer

Listssales material that

was used

o

by a person whose duties are separate from the marketing area of the insurer

toll free numbercompany personnel involved in

the compliance function

o

retain copiesindexed by replacing insurer

Page 110 of Appendix

consecutive automatic premium loans or systematic withdrawals

The notice shall be signed by both the applicant and the producer

Page 111 of Appendix

the producer shall leave with the applicant

the original or a copy of all sales material

a statement identifying any preprinted or electronically presented company approved sales materials used copies of any individualized sales materials any illustrations

financed purchase

within thirteen months before or after the effective date of the new policy

deemed prima facie evidence of a financed purchase.

Page 112 of Appendix

Variable Product Distribution: A Continuing Study of Compliance Examinations, Inspections Sweeps and Evolving Regulatory Standards

Variable Product Distribution: A Continuing Study of Compliance Examinations, Inspections Sweeps and Evolving Regulatory Standards

Variable Product Distribution: A Continuing Study of Compliance Examinations, Inspections Sweeps and Evolving Regulatory Standards

Page 113 of Appendix

Page 114 of Appendix

This document must be signed by the applicant and the producer, if there is one, and a copy left with the applicant.

Page 115 of Appendix

Page 116 of Appendix

Page 117 of Appendix

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Page 168 of Appendix

Page 169 of Appendix

Page 170 of Appendix

Page 171 of Appendix

Page 172 of Appendix

Page 173 of Appendix

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Pag

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3

See

Page 196 of Appendix

4

See

See

Page 197 of Appendix

See

See

See

Page 198 of Appendix

See

Page 199 of Appendix

See

Page 200 of Appendix

See

See

Page 201 of Appendix

oo

o

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Page 202 of Appendix

ACLI

LAW

SU

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Free

Lo

ok/

Rig

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To R

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equ

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Wh

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New

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Sub

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top

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stat

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Ad

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time

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in t

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the

ACLI

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surv

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Life

Ins

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nnui

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Lik

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Sur

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ACLI

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The

Law

Sur

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ann

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Not

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Prem

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See

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Sur

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of e

xem

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May

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Life

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Rep

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polic

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and

annu

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insu

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s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In t

he p

olic

y or

co

ntra

ct30

day

sPr

emiu

ms

or

cons

ider

atio

ns,

incl

udin

g an

y fe

es o

r ch

arge

s. F

or

a va

riab

le o

r m

arke

t va

lue-

adju

sted

life

in

sura

nce

polic

y or

an

nuity

con

trac

t, t

he

cash

sur

rend

er v

alue

pl

us t

he fee

s or

oth

er

char

ges

dedu

cted

fro

mth

e gr

oss

prem

ium

s or

co

nsid

erat

ions

or

othe

rwis

e im

pose

d un

der

the

life

insu

ranc

epo

licy

or a

nnui

ty c

ontr

act.

AZ

AZ R

ev. Sta

t. A

nn.

§20-

1233

Ann

uity

con

trac

tsAnn

uity

con

trac

t su

pple

men

tal t

o a

sett

led

annu

itypr

ovid

ing

for

paym

ents

in c

onsi

dera

tion

of

accu

mul

atio

ns fro

m t

he o

rigi

nal

cont

ract

and

tha

t is

issu

ed o

nly

to t

he

orig

inal

con

trac

t ho

lder

s

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays

or 3

0 da

ys if

the

co

ntra

ct h

olde

r is

65

or

olde

r on

th

e da

te o

f th

e ap

plic

atio

n

All

mon

ies

paid

; fo

r va

riab

le a

nnui

ties,

sum

of

diff

eren

ce b

etw

een

prem

ium

s pa

id,

incl

udin

g an

y po

licy

or c

ontr

act

fees

or

othe

r ch

arge

s,

and

amou

nts

allo

cate

d to

se

para

te a

ccou

nts

unde

r po

licy

or c

ontr

act,

and

va

lue

of a

mou

nts

allo

cate

d to

sep

arat

e ac

coun

ts u

nder

pol

icy

or

cont

ract

on

date

the

re

turn

ed p

olic

y is

re

ceiv

ed b

y in

sure

r or

its

prod

ucer

Pag

e 20

6 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

AZ R

ev. Sta

t. A

nn.

§20-

1242

.01

AZ R

ev. Sta

t. A

nn.

§20-

1242

.02

Gro

up a

nd in

divi

dual

an

nuiti

es

Reg

iste

red/

nonr

egis

tere

d va

riab

le

annu

ities

or

othe

r re

gist

ered

pr

oduc

ts;

imm

edia

te a

nd d

efer

red

annu

ities

con

tain

ing

no

nong

uara

ntee

d el

emen

ts;

annu

ities

us

ed t

o fu

nd c

erta

in p

ensi

on p

lans

; no

nqua

lifie

d de

ferr

ed c

ompe

nsat

ion

arra

ngem

ents

; st

ruct

ured

set

tlem

ent

annu

ities

15 d

ays,

whe

n Buy

er’s

Gui

de

and

disc

losu

re

docu

men

t ar

e no

t pr

ovid

ed a

t or

bef

ore

the

time

of

appl

icat

ion

App

lican

t m

ay r

etur

n co

ntra

ct “

with

out

pena

lty”

AZ R

ev. Sta

t. A

nn.

§20-

1691

.07

Long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

AZ A

dmin

. Cod

e R20

-6-5

01In

divi

dual

dis

abili

ty

insu

ranc

eO

ne w

here

no

prov

isio

n fo

r re

new

al is

m

ade

Prin

ted

on o

r at

tach

ed t

o 1st

page

or

end

orse

d in

a

notic

e in

a p

rom

inen

t st

yle

10 d

ays

(or

long

er,

at

insu

rer’s

optio

n)

Prem

ium

, po

licy

fees

and

ot

her

char

ges

paid

AZ A

dmin

. Cod

e R20

-6-2

09(C

)(1)

Life

insu

ranc

eAnn

uitie

s, c

redi

t lif

e in

sura

nce,

gro

up

life

insu

ranc

e, li

fe in

sura

nce

polic

ies

issu

ed in

con

nect

ion

with

a p

ensi

on

or w

elfa

re p

lan,

or

variab

le li

fe

insu

ranc

e

In p

olic

y or

pol

icy

sum

mar

y10

day

s, w

hen

the

Buy

er’s

G

uide

and

a

Polic

y Sum

mar

y ar

e no

t de

liver

ed

prio

r to

ac

cept

ance

of

the

appl

ican

t’s

initi

al p

rem

ium

or

pre

miu

m

depo

sit.

Unc

ondi

tiona

l ref

und

Pag

e 20

7 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

AZ R

ev. Sta

t. A

nn.

§20-

1241

.01

AZ R

ev. Sta

t. A

nn.

§20-

1241

.03

AZ

Rev

. Sta

t. A

nn.

§ 20

-124

1.05

(E)

Rep

lace

men

t of

life

in

sura

nce

polic

ies

and

annu

ity c

ontr

acts

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

notic

e re

quired

un

der

AZ

Rev

. Sta

t.

Ann

. §2

0-12

41.0

3,

subs

ectio

ns C

and

D

See

als

o AZ

Adm

in.

Cod

eR20

-6-2

12fo

r re

fere

nce

to

appl

icab

le N

AIC

mod

el r

epla

cem

ent

notic

e fo

rm.

30 d

ays

Prem

ium

s or

co

nsid

erat

ion

paid

, in

clud

ing

polic

y fe

es o

r ch

arge

s or

, in

cas

e of

a

variab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y,

paym

ent

of c

ash

surr

ende

r va

lue

plus

all

fees

and

oth

er c

harg

es

dedu

cted

fro

m g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

polic

y

AR

AR C

ode

Ann

. §2

3-79

-112

(f)

Indi

vidu

al li

fe,

annu

ity,

and

acci

dent

& h

ealth

pol

icie

s or

co

ntra

ct fili

ngs

Var

iabl

e lif

e po

licie

s, v

aria

ble

annu

ities

Prom

inen

tly p

rint

ed

on 1

st p

age

of p

olic

y or

con

trac

t

At

leas

t 10

day

s un

less

pol

icy

or

cont

ract

spe

cifie

sa

grea

ter

period

Prem

ium

AR C

ode

Ann

. §2

3-97

-311

Long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

edon

or a

ttac

hed

to 1

st

page

30 d

ays

Prem

ium

AR A

DC 0

54.0

0.33

-IV

(Ark

. Rul

e an

d Reg

ulat

ion

33, ar

t.IV

, Sec

.3(

a)(5

))

Var

iabl

e lif

e Cap

tione

d pr

ovis

ion

on t

he c

over

pag

e or

pa

ges

corr

espo

ndin

g to

the

cov

er p

age

10 d

ays

To e

xten

t pe

rmitt

ed b

y st

ate

law

ref

und

equa

ls

sum

of

(i)

differ

ence

be

twee

n pr

emiu

ms

paid

in

clud

ing

polic

y fe

es o

r ot

her

char

ges

and

amou

nts

allo

cate

d to

se

para

te a

ccou

nts

and

(ii)

the

val

ue o

f th

e am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s on

the

da

te t

he r

etur

n po

licy

is

rece

ived

by

insu

rer

or it

s ag

ent.

Unt

il st

ate

law

au

thor

izes

thi

s m

etho

d,

the

amou

nt o

f th

e re

fund

sh

all b

e th

e to

tal o

f al

l pr

emiu

m p

aym

ents

.

Pag

e 20

8 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

AR A

DC 0

54.0

0.60

-8(A

rk. Rul

e an

d Reg

ulat

ion

60,

Sec

. 8

(C)(

b))

Acc

eler

ated

ben

efit

prov

isio

ns in

indi

vidu

al li

fe

insu

ranc

e po

licie

s so

licite

d by

direc

t re

spon

se m

etho

ds

Long

-ter

m c

are

insu

ranc

eIn

a d

iscl

osur

e fo

rm

prov

ided

whe

n th

e po

licy

is d

eliv

ered

10 d

ays

Prem

ium

CA

CA I

ns. Cod

e §1

0127

.7In

divi

dual

life

pol

icie

s w

ith a

fa

ce v

alue

less

tha

n $1

0,00

0

and

any

rene

wal

Indi

vidu

al li

fe p

olic

ies

issu

ed in

co

nnec

tion

with

cre

dit

tran

sact

ions

or

unde

r co

ntra

ctua

l pol

icy

chan

ge o

r co

nver

sion

privi

lege

pro

visi

on

Prin

ted

on o

r at

tach

ed t

o po

licy

Not

less

tha

n 10

no

r m

ore

than

30

day

s

Prem

ium

and

pol

icy

fee

with

in 3

0 da

ys fro

m t

he

date

tha

t th

e in

sure

r is

no

tifie

d th

at in

sure

d ha

s ca

ncel

ed t

he p

olic

y fo

r al

l pol

icie

s is

sued

, am

ende

d, o

r de

liver

ed in

th

is s

tate

on

or a

fter

Ja

nuar

y 1,

201

1, a

nd

appl

ies

to a

ny r

enew

al

ther

eof.

All

polic

ies

subj

ect

to t

his

sect

ion

that

are

in e

ffec

t on

Ja

nuar

y 1,

201

1, s

hall

be

cons

true

d to

be

in

com

plia

nce

with

thi

s se

ctio

n.

CA I

ns. Cod

e §1

0127

.9In

divi

dual

life

insu

ranc

e In

divi

dual

life

pol

icie

s su

bjec

t to

CA I

ns. Cod

e §1

0127

.7an

d th

ose

issu

ed in

con

nect

ion

with

cre

dit

tran

sact

ions

or

unde

r co

ntra

ctua

l po

licy

chan

ge o

r co

nver

sion

privi

lege

pr

ovis

ion

Prin

ted

on o

r at

tach

ed t

o po

licy

Not

less

tha

n 10

no

r m

ore

than

30

day

s

Prem

ium

and

pol

icy

fee,

bu

t fo

r va

riab

le

annu

ities

, va

riab

le li

fe,

and

mod

ified

gua

rant

eed

cont

ract

s, t

he o

wne

r is

en

title

d to

a r

efun

d of

ac

coun

t va

lue

and

any

polic

y fe

e pa

id. Ref

und

mus

t be

mad

e w

ithin

30

days

fro

m t

he d

ate

that

th

e in

sure

r is

not

ified

th

at t

he in

sure

d ha

s ca

ncel

ed t

he p

olic

y.

Pag

e 20

9 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

CA I

ns. Cod

e §1

0127

.10

Indi

vidu

al li

fe in

sura

nce

polic

ies

or a

nnui

ty c

ontr

acts

is

sued

or

deliv

ered

to

seni

or

citiz

en,

60 y

ears

or

olde

r

Indi

vidu

al li

fe p

olic

ies

issu

ed in

co

nnec

tion

with

a c

redi

t tr

ansa

ctio

n or

und

er c

ontr

actu

al p

olic

y ch

ange

or

conv

ersi

on p

rivi

lege

pro

visi

on,

empl

oyer

gro

up a

nnui

ty c

ontr

acts

an

d gr

oup

term

life

insu

ranc

e

On

cove

r pa

ge o

r po

licy

jack

et in

12-

poin

t bo

ld p

rint

with

on

e-in

ch s

pace

on

all

side

s or

on

stic

ker

affix

ed t

o co

ver

page

or

pol

icy

jack

et

Not

less

tha

n 30

da

ysPr

emiu

m a

nd p

olic

y fe

e fo

r in

divi

dual

life

and

for

va

riab

le c

ontr

acts

for

w

hich

the

ow

ner

did

not

dire

ct t

hat

the

prem

ium

be

inve

sted

in m

utua

l fu

nds

during

the

ca

ncel

latio

n pe

riod

. Acc

ount

val

ue r

efun

ded

for

variab

le a

nnui

ties

for

whi

ch t

he o

wne

r di

rect

ed

the

prem

ium

be

inve

sted

in

mut

ual f

unds

dur

ing

canc

ella

tion

period

. Ref

und

mus

t be

with

in

30 d

ays

from

the

dat

e th

at t

he in

sure

r is

no

tifie

d th

at t

he in

sure

d ha

s ca

ncel

ed t

he p

olic

y.

CA

In

s. C

ode

§1

02

95

CA

In

s. C

ode

§1

02

95

.3

CA

In

s. C

ode

§1

02

95

.8

Acc

eler

ated

ben

efit

s p

olic

ies,

pro

visi

on,

end

orse

men

tsor

rid

ers

add

ed t

o li

fe in

sura

nce

p

olic

ies

Hea

lth

, ac

cid

ent,

or

lon

g-t

erm

ca

re in

sura

nce

P

rom

inen

tly

pri

nte

d o

r at

tach

ed t

o p

olic

y,

cert

ific

ate,

rid

er o

r en

dor

sem

ent;

for

so

lici

tati

on b

y d

irec

t re

spon

se,

dis

clos

ure

for

m

pro

vid

ed w

ith

ap

plic

atio

n

30

day

sP

rem

ium

; if

purc

has

ed

as e

nd

orse

men

t or

ri

der

at

sam

e ti

me

as

bas

e lif

e in

sura

nce

po

licy

, th

en

end

orse

men

t o

r ri

der

m

ay b

e re

turn

ed

wit

hin

30

day

san

d

un

der

lyin

g li

fe

insu

ran

ce p

oli

cy i

s o

ther

wis

e su

bje

ct t

o

cod

e.

CA I

ns. Cod

e §1

0232

.7Lo

ng-t

erm

car

e po

licie

s or

ce

rtifi

cate

sG

roup

long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge o

f po

licy

or

cert

ifica

te

30 d

ays

Prem

ium

and

pol

icy

fee

mus

t be

ref

unde

d w

ithin

30

day

s of

rec

eipt

of

retu

rned

pol

icy.

CA I

ns. Cod

e §1

0276

Indi

vidu

al a

ccid

ent

and

heal

th p

olic

ies

or c

ontr

acts

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

or c

ontr

acts

Prin

ted

on o

r at

tach

ed t

o po

licy

or

cont

ract

Not

less

tha

n 10

no

r m

ore

than

30

day

s

Prem

ium

Pag

e 21

0 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

10 C

CR §

2522

.8(a

)(3)

(G)

Indi

vidu

al in

vest

men

t an

nuiti

esPr

inte

d on

ap

plic

atio

n10

day

sAll

annu

ity p

urch

ase

cont

ribu

tions

CA I

ns. Cod

e §1

0509

.6(d

)Rep

lace

men

t of

life

in

sura

nce

polic

ies

and

annu

ity c

ontr

acts

by

insu

rers

usi

ng a

gent

s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

sep

arat

e w

ritt

en n

otic

e de

liver

ed w

ith p

olic

y

30 d

ays

Prem

ium

and

polic

y fe

e,bu

t fo

r va

riab

le

annu

ities

, va

riab

le li

fe,

and

mod

ified

gua

rant

eed

cont

ract

s, t

he o

wne

r is

en

title

d to

a r

efun

d of

ac

coun

t va

lue

and

any

polic

y fe

e pa

id. Ref

und

mus

t be

mad

e w

ithin

30

days

fro

m t

he d

ate

that

th

e in

sure

r is

not

ified

th

at t

he o

wne

r ha

s ca

ncel

ed t

he p

olic

y.

CO

CO

Rev

. Sta

t. A

nn.

§10-

7-30

2(1

)(g)

CO

Rev

. Sta

t. A

nn.

§10-

7-30

7

Life

insu

ranc

e po

licie

s Rei

nsur

ance

, gr

oup

insu

ranc

e, p

ure

endo

wm

ents

, an

nuiti

es o

r re

vers

iona

ry a

nnui

ty c

ontr

acts

, ce

rtai

n te

rm p

olic

ies;

pol

icie

s w

hich

pr

ovid

e no

gua

rant

eed

nonf

orfe

iture

or

end

owm

ent

bene

fits,

for

whi

ch n

o ca

sh s

urre

nder

val

ue o

r pr

esen

t va

lue

of a

ny p

aid-

up n

onfo

rfei

ture

ben

efit,

at

the

beg

inni

ng o

f an

y po

licy

year

ex

ceed

s 2-

1/2%

of th

e am

ount

of

insu

ranc

e at

the

beg

inni

ng o

f th

e sa

me

polic

y ye

ar;

and

polic

ies

shal

l de

liver

ed o

utsi

de t

he s

tate

thr

ough

an

age

nt

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

15 d

ays

Prem

ium

, bu

t fo

r va

riab

le li

fe in

sura

nce

the

polic

yhol

der

is

entit

led

to a

ref

und

of

the

acco

unt

valu

e pl

us

any

polic

y fe

e or

cha

rge

dedu

cted

fro

m t

he

polic

y.

CO

Rev

. Sta

t. A

nn.

§10-

19-1

11App

licab

le t

o lo

ng-t

erm

car

e in

sura

nce

appl

ican

ts;

notic

e re

quirem

ents

app

licab

le t

o lo

ng-t

erm

car

e in

sura

nce

polic

ies

and

cert

ifica

tes

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 21

1 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

3 CO

AD

C I

NS

4-1-

4,Sec

tions

7(A

)(4)

and

3(

B)

Rep

lace

men

t of

life

pol

icie

s or

ann

uity

con

trac

ts b

y in

sure

rs t

hat

use

prod

ucer

s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in A

ppen

dix

A o

r C.

30 d

ays

Prem

ium

s or

co

nsid

erat

ions

pai

d,

incl

udin

g an

y po

licy

fees

or

cha

rges

, bu

t fo

r va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y th

e ow

ner

is e

ntitl

ed t

o pa

ymen

t of

the

cas

h su

rren

der

valu

e pl

us t

he

fees

and

oth

er c

harg

es

dedu

cted

fro

m t

he g

ross

pr

emiu

ms.

3 CO

AD

C I

NS

4-1-

12,

Sec

tion

5All

grou

p an

d in

divi

dual

an

nuity

con

trac

ts a

nd

cert

ifica

tes,

incl

udin

g ce

rtai

n an

nuiti

es u

sed

to f

und

a pl

an

or a

rran

gem

ent

that

is

fund

ed s

olel

y by

co

ntribu

tions

an

empl

oyee

el

ects

to

mak

e w

heth

er o

r a

pre-

tax

or a

fter

-tax

bas

is

Reg

iste

red

or n

on-r

egis

tere

d va

riab

le

annu

ities

or

othe

r re

gist

ered

pr

oduc

ts;

imm

edia

te a

nd d

efer

red

annu

ities

tha

t co

ntai

n no

non

-gu

aran

teed

ele

men

ts;

annu

ities

use

d to

fun

d ce

rtai

n pe

nsio

n pl

ans;

st

ruct

ured

set

tlem

ent

annu

ities

, ch

arita

ble

gift

ann

uitie

s, a

nd fun

ding

ag

reem

ents

15 d

ays

whe

re

the

Buy

er’s

G

uide

and

di

sclo

sure

do

cum

ent

are

not

prov

ided

at

or b

efor

e th

e tim

e of

ap

plic

atio

n

CT

CT

Gen

. Sta

t. A

nn.

§38a

-436

Indi

vidu

al li

fepo

licie

sPr

inte

d on

or

atta

ched

to

polic

y10

day

sPr

emiu

ms

CT

ADC §

38a-

457-

5(c

)(6)

Acc

eler

ated

ben

efits

pol

icy

with

a r

ider

pro

vidi

ng for

ad

ditio

nal p

rem

ium

pa

ymen

ts w

ith a

n ef

fect

ive

date

sub

sequ

ent

to t

he

effe

ctiv

e da

te o

f th

e lif

e in

sura

nce

polic

y

Long

-ter

m c

are

polic

ies

Prin

ted

on o

r at

tach

ed t

o po

licy

10 d

ays

Not

spe

cifie

d. R

ider

sha

ll be

voi

d ab

initi

o.

CT

ADC §

38a-

501-

11(g

)In

divi

dual

long

-ter

m c

are

insu

ranc

e, in

clud

ing

that

is

sued

pur

suan

t to

direc

t re

spon

se s

olic

itatio

n

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 21

2 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

CT

ADC §

38a-

433-

4(c

)(1)

(E)

CT

ADC §

38a-

433-

2(s

)

CT

Bul

letin

PF-

19(J

une

11, 19

90)

Indi

vidu

al v

aria

ble

life

insu

ranc

e po

licie

sCap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

of

polic

y

10 d

ays

To e

xten

t pe

rmitt

ed b

y st

ate

law

ref

und

equa

ls

the

sum

of (i

) di

ffer

ence

be

twee

n pr

emiu

ms

paid

in

clud

ing

polic

y fe

es o

r ot

her

char

ges

and

amou

nts

allo

cate

d to

se

para

te a

ccou

nts

and

(ii)

the

val

ue o

f th

e am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s on

da

te r

etur

ned

polic

y is

re

ceiv

ed b

y in

sure

r or

its

agen

t. U

ntil

stat

e la

w

auth

oriz

es t

his

met

hod,

am

ount

of re

fund

sha

ll be

tot

al o

f al

l pre

miu

m

paym

ents

.

CT

ADC §

38a-

505-

10(A

)(7)

Indi

vidu

al a

ccid

ent

and

sick

ness

pol

icie

sSin

gle

prem

ium

non

-ren

ewab

le

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1st

page

10 d

ays

Prem

ium

CT

Bul

letin

PF-

19(J

une

11, 19

90)

Indi

vidu

al f

ixed

ann

uitie

s an

d in

divi

dual

mod

ified

gu

aran

teed

life

insu

ranc

e

10 d

ays

Prem

ium

s

CT

Bul

letin

PF-

19(J

une

11, 19

90)

Indi

vidu

al v

aria

ble

annu

ities

an

d in

divi

dual

mod

ified

gu

aran

teed

ann

uitie

s

10 d

ays

A)

Tota

l pre

miu

ms

if ca

ncel

latio

n is

mad

e pr

ior

to a

ctua

l del

iver

y of

co

ntra

ct;

or B

) An

amou

nt e

qual

to

the

sum

of

(a)

diff

eren

ce b

etw

een

prem

ium

s pa

id in

clud

ing

any

polic

y fe

es o

r ot

her

char

ges

and

amou

nts

allo

cate

d to

any

sep

arat

e ac

coun

ts a

nd (

b) v

alue

of

am

ount

s al

loca

ted

to

any

sepa

rate

acc

ount

s,

on t

he d

ate

the

retu

rned

po

licy

is r

ecei

ved

by t

he

insu

rer

or it

s ag

ent

Pag

e 21

3 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

CT

AD

C §

38

a-4

35

-5(a

)(4

)R

epla

cem

ent

of li

fe

insu

ran

ce a

nd

an

nu

itie

s b

y in

sure

rs t

hat

use

p

rod

uce

rs

See

AC

LI’s

Rep

lace

men

t La

w

Su

rvey

for

list

of

exem

ptio

ns.

May

be

incl

ud

ed in

n

oti

ce d

escr

ibed

in

Ap

pen

dix

A o

r C

10

day

sP

rem

ium

/co

nsi

der

atio

n,

incl

ud

ing

an

y p

olic

y fe

es/c

har

ges

or,

in

the

case

of

a va

riab

le

or

mar

ket

valu

e ad

just

men

t po

licy

or

con

trac

t, c

ash

su

rren

der

val

ue

plu

s fe

es a

nd

char

ges

DE

DE

ST

TI 1

8 s7

105

(f)

Long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

18 D

E AD

C 1

203

Life

insu

ranc

eAnn

uitie

s, c

redi

t lif

e, g

roup

life

, lif

e in

sura

nce

polic

ies

issu

ed in

co

njun

ctio

n w

ith c

erta

in p

ensi

on a

nd

wel

fare

, va

riab

le li

fe in

sura

nce

unde

r w

hich

dea

th b

enef

its a

nd c

ash

valu

es

vary

in a

ccor

danc

e w

ith u

nit

valu

es o

f in

vest

men

ts h

eld

in s

epar

ate

acco

unts

In p

olic

y or

pol

icy

sum

mar

y10

day

s (I

f no

un

cond

ition

al

refu

nd

prov

isio

n/of

fer,

Buy

er’s

Gui

de

and

Polic

y Sum

mar

y m

ust

be p

rovi

ded.

)

Not

spe

cifie

d

18 D

E AD

C 1

204-

7.0

(7.4

)Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e ag

ents

or

brok

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

sep

arat

e w

ritt

en n

otic

e de

liver

ed w

ith p

olic

y

20 d

ays

Prem

ium

Pag

e 21

4 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

DC

DC M

un.

Reg

s.

tit.

26-A

§27

12(a

)(5)

Var

iabl

e lif

ein

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

of

polic

y

Eith

er w

ithin

45

days

of da

te o

f ex

ecut

ion

of t

he

appl

icat

ion

or

with

in 1

0 da

ys o

f re

ceip

t of

pol

icy

by p

olic

yhol

der,

w

hich

ever

is

late

r

Prem

ium

DC C

ode

Ann

. §3

1-36

05(d

)(2)

Long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o

1st

page

30 d

ays

Prem

ium

FLFL

Sta

t. A

nn §

626.

99(4

)(a)

Life

insu

ranc

e po

licie

sAnn

uitie

s, c

redi

t lif

e, g

roup

life

, lif

e in

sura

nce

polic

ies

issu

ed in

co

njun

ctio

n w

ith c

erta

in p

ensi

on a

nd

wel

fare

pla

ns,

variab

le li

fe in

sura

nce

unde

r w

hich

dea

th b

enef

its a

nd c

ash

valu

es v

ary

in a

ccor

danc

e w

ith u

nit

valu

es o

f in

vest

men

ts h

eld

in

sepa

rate

acc

ount

s

In p

olic

y or

pol

icy

sum

mar

y14

day

s(I

f no

un

cond

ition

al

refu

nd

prov

isio

n/of

fer,

Buy

er’s

Gui

de

and

a Po

licy

Sum

mar

y m

ust

be p

rovi

ded.

)

“Unc

ondi

tiona

l ref

und”

FL S

tat.

Ann

§62

6.99

(4)(

b) a

nd (

c)Fi

xed

and

variab

le a

nnui

ties

Cov

er p

age

of

con

trac

t2

1 d

ays

“Unc

ondi

tiona

l ref

und”

Fixe

d an

nu

itie

s-

Pre

miu

ms,

con

trac

t fe

es a

nd

char

ges

;V

aria

ble

ann

uit

ies

-ca

sh s

urr

end

er v

alu

e,

plu

s fe

es a

nd

ch

arg

eso

r p

rem

ium

s p

aid

FL S

tat.

Ann

§6

27.9

407

(8)

69

FL

Adm

in.

Cod

e A

nn

. 69

O-1

57

.01

8R

epea

led

. Ef

fect

ive

Jan

. 28

, 20

13

.

Indi

vidu

al lo

ng-t

erm

car

e po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 21

5 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

69 F

L Ad

min

. Cod

e Ann

. 69

O-1

54.0

03In

divi

dual

dis

abili

ty

insu

ranc

e po

licie

sSin

gle

prem

ium

non

-ren

ewab

le

polic

ies

or c

ontr

acts

or

trav

el

acci

dent

pol

icie

s or

con

trac

ts

Not

ice

in a

pr

omin

ent

plac

e

prin

ted

or s

tam

ped

on o

r at

tach

ed t

o po

licy

10 d

ays

Prem

ium

69 F

L Ad

min

. Cod

e Ann

. 69

O-1

51.0

03

69 F

L Ad

min

. Cod

e Ann

. 69

O-1

51.0

04

69 F

L Ad

min

. Cod

e Ann

. 69

O-1

51.0

07(3

)(d)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

, in

clud

ing

tax

shel

tere

d an

nuiti

es a

nd li

fe in

sura

nce

that

qua

lifie

s as

tax

sh

elte

red

annu

ity

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

10 d

ays

(If

no

unco

nditi

onal

re

fund

pr

ovis

ion/

offe

r,

Buy

er’s

Gui

de

and

a Po

licy

Sum

mar

y m

ust

be p

rovi

ded.

)

“Unc

ondi

tiona

l ref

und”

GA

GA C

ode

Ann

. §3

3-25

-8In

divi

dual

life

pol

icie

sIn

divi

dual

life

pol

icie

s is

sued

in

conn

ectio

n w

ith a

cre

dit

tran

sact

ion

Prin

ted

on o

r at

tach

ed t

o co

ntra

ct10

day

sPr

emiu

m

GA C

ode

Ann

. §3

3-26

-4In

dust

rial

life

pol

icie

sPr

inte

d on

or

atta

ched

to

cont

ract

10 d

ays

Prem

ium

GA C

ode

Ann

. §3

3-28

-6(a

)Ann

uitie

s, r

ever

sion

ary

annu

ities

, pu

re e

ndow

men

t co

ntra

cts

Gro

up a

nnui

ty c

ontr

acts

Prin

ted

on o

r at

tach

ed t

o co

ntra

ct10

day

sPr

emiu

m

GA C

ode

Ann

. §3

3-42

-6(f

)In

divi

dual

long

-ter

m c

are

polic

ies,

incl

udin

g di

rect

re

spon

se s

olic

itatio

n

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

GA C

ode

Ann

. §3

3-29

-11

Indi

vidu

al a

ccid

ent

and

sick

ness

pol

icie

sSin

gle

prem

ium

non

rene

wab

le

polic

ies

or c

ontr

acts

Prin

ted

on o

r at

tach

ed t

o po

licy

or

cont

ract

10 d

ays

Prem

ium

Pag

e 21

6 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

GA C

omp.

R. &

Reg

s.

120-

2-73

-.02

GA C

omp.

R. &

Reg

s.

120-

2-73

-.05

Indi

vidu

al d

efer

red

annu

ities

an

d gr

oup

annu

ities

and

de

posi

t fu

nds

(i.e

. ar

rang

emen

ts u

nder

whi

ch

amou

nts

to a

ccum

ulat

e at

in

tere

st a

re p

aid

in a

dditi

on

to li

fe in

sura

nce

prem

ium

s or

ann

uity

con

side

ratio

ns

unde

r pr

ovis

ions

of

indi

vidu

al li

fe in

sura

nce

polic

ies

or a

nnui

ty c

ontr

acts

)

1. I

ndiv

idua

l def

erre

d an

nuiti

es a

nd

grou

pan

nuiti

es w

hich

are

: (i

) va

riab

le a

nnui

ties;

(ii)

reg

iste

red

with

th

e Fe

dera

l SEC

; (i

ii) c

ontr

acts

with

va

riab

le a

nnui

ty f

eatu

res

avai

labl

e at

op

tion

of c

ontr

act

owne

r; 2

. gr

oup

annu

ity c

ontr

acts

who

se c

ost

is b

orne

in

who

le o

r in

par

t by

the

ann

uita

nt's

em

ploy

er o

r as

soci

atio

n; 3

. im

med

iate

ann

uity

con

trac

ts;

4.

polic

ies

issu

ed in

con

nect

ion

with

ce

rtai

n pe

nsio

n pl

ans;

5. in

divi

dual

re

tirem

ent

acco

unts

and

Sec

. 40

8 in

divi

dual

ret

irem

ent

annu

ities

; 6.

a

sing

le a

dvan

ce p

aym

ent

of s

peci

fic

prem

ium

s eq

ual t

o th

e di

scou

nted

va

lue

of s

uch

prem

ium

s; a

nd 7

. ce

rtai

n po

licyh

olde

r de

posi

t ac

coun

ts.

In p

olic

y or

con

trac

t or

in c

ontr

act

sum

mar

y

10 d

ays

(If

no

unco

nditi

onal

re

fund

pr

ovis

ion/

offe

r,

Buy

er’s

Gui

de

and

a Po

licy

Sum

mar

y m

ust

be p

rovi

ded

prio

r to

acc

eptin

g in

itial

ann

uity

co

nsid

erat

ion.

)

“Unc

ondi

tiona

l ref

und”

GA C

omp.

R.&

Reg

s.

120-

2-24

-.08

Exhi

bit

A;

GA C

omp.

R. &

Reg

s.

120-

2-24

-.04

,

GA C

omp.

R. &

Reg

s.

120-

2-24

-.07

Rep

lace

men

t of

life

in

sura

nce

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In R

epla

cem

ent

Not

ice

(Exh

ibit

A)

Not

spe

cifie

dN

ot s

peci

fied

HI

HI

Rev

. Sta

t. A

nn.

§431

:10-

214

Indi

vidu

al li

fe p

olic

ies,

in

divi

dual

acc

iden

t an

d he

alth

or

sick

ness

pol

icie

s

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

or t

rave

l acc

iden

t po

licie

sPr

inte

d on

or

atta

ched

to

polic

y in

10

-poi

nt b

old

type

10 d

ays

Prem

ium

, bu

t in

sure

r m

ay b

e re

imbu

rsed

for

ac

tual

med

ical

ex

amin

atio

n ex

pens

es

incu

rred

in p

roce

ssin

g po

licy,

pro

vide

d no

tice

incl

udes

suc

h st

atem

ent.

Pag

e 21

7 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

HI

Rev

. Sta

t. A

nn.

§431

:10D

-603

Ann

uitie

sSol

icita

tion

for

an a

nnui

ty c

ontr

act

prov

ided

in o

ther

tha

n a

pers

onal

m

eetin

g

15 d

ays,

whe

n Buy

er’s

Gui

de

and

disc

losu

re

docu

men

t ar

e no

t pr

ovid

ed a

t or

bef

ore

the

time

of

appl

icat

ion

App

lican

t m

ay r

etur

n co

ntra

ct w

ithou

t pe

nalty

HI

Rev

. Sta

t. A

nn.

§431

:10D

-603

(b)

Sol

icita

tion

for

an a

nnui

ty

cont

ract

pro

vide

d in

oth

er

than

a p

erso

nal m

eetin

g

Sol

icita

tion

mus

t in

clud

e st

atem

ent

that

pro

spec

tive

appl

ican

t m

ay

cont

act

the

insu

ranc

e di

visi

on for

a

free

buy

er's

gui

de

Not

spe

cifie

dN

ot s

peci

fied

HI

Rev

. Sta

t. A

nn.

§431

:10H

-111

Long

-ter

m c

are

polic

ies

Gro

up lo

ng-t

erm

car

e po

licie

s is

sued

to

em

ploy

er o

r la

bor

orga

niza

tion

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

HI

Rev

. Sta

t. A

nn.

§431

:10D

-501

HI

Rev

. Sta

t. A

nn.

§431

:10D

-505

(a)(

4)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

con

trac

t ow

ner

notic

e30

day

sPr

emiu

m/c

onsi

dera

tion,

in

clud

ing

polic

y fe

es/c

harg

es, or

, in

cas

e of

var

iabl

e or

mar

ket

valu

e ad

just

men

t po

licy,

ca

sh s

urre

nder

val

ue

plus

all

fees

and

cha

rges

de

duct

ed fro

m t

he g

ross

pr

emiu

ms

or

cons

ider

atio

ns;

prov

ided

th

at s

uch

notic

e m

ay b

e in

clud

ed in

for

ms

appr

oved

by

the

com

mis

sion

er

Pag

e 21

8 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

IDID

Cod

e §4

1-19

35(1

)

ID C

ode

§41-

1901

Life

insu

ranc

e po

licie

s an

d an

nuity

con

trac

ts

Gro

up li

fe in

sura

nce;

gro

up

annu

ities

; re

insu

ranc

eIn

pol

icy

or c

ontr

act

unde

r ap

prop

riat

e ca

ptio

n an

d if

not

so

prin

ted

on fac

e pa

ge

of p

olic

y, p

rint

ed o

r st

ampe

d co

nspi

cuou

sly

on

face

pag

e

20 d

ays

Prem

ium

ID C

ode

§41-

4605

(6)

ID C

ode

§41-

4603

(4)(

a)

Long

-ter

m c

are

polic

ies,

in

clud

ing

thos

e is

sued

pu

rsua

nt t

o di

rect

res

pons

e so

licita

tion

Long

-ter

m c

are

cert

ifica

te is

sued

to

spec

ified

em

ploy

er g

roup

s de

fined

in

§ 41

-460

3(4)

(a)

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

ID C

ode

§41-

2138

Indi

vidu

al h

ealth

insu

ranc

e po

licie

sN

onre

new

able

acc

iden

t po

licie

s an

d in

divi

dual

cre

dit

heal

th in

sura

nce

polic

ies

Cap

tione

d in

pol

icy

or s

epar

ate

ride

r at

tach

ed t

o po

licy

whe

n de

liver

ed, or

no

tice

of p

rovi

sion

pr

inte

d or

sta

mpe

d on

fac

e pa

ge

10 d

ays

Prem

ium

ID A

dmin

. Cod

e18

.01.

41.0

14Rep

lace

men

t of

life

and

an

nuiti

es b

y in

sure

rs t

hat

use

agen

ts o

r br

oker

s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

in

sepa

rate

writt

en

notic

e de

liver

ed w

ith

polic

y

20 d

ays

Prem

ium

IL21

5 IL

CS

5/22

4(1

)(n)

In

divi

dual

life

insu

ranc

eD

irec

tor

may

by

rule

exe

mpt

spe

cific

ty

pes

of p

olic

ies

Prov

isio

n or

not

ice

atta

ched

to

polic

y10

day

sPr

emiu

m a

nd p

olic

y fe

es

215

ILCS

5/22

9(1

)(m

)In

dust

rial

life

insu

ranc

eD

irec

tor

may

by

rule

exe

mpt

spe

cific

ty

pes

of p

olic

ies

Prov

isio

n or

not

ice

atta

ched

to

polic

y10

day

sPr

emiu

m a

nd p

olic

y fe

es

215

ILCS

5/35

1A-7

Indi

vidu

al lo

ng-t

erm

car

e po

licie

s, in

clud

ing

dire

ct

res p

onse

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 21

9 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

215

ILCS

5/22

6(1

)(h)

Ann

uitie

s an

d pu

re

endo

wm

ent

cont

ract

sRev

ersi

onar

y an

nuiti

es,

surv

ivor

ship

an

nuiti

es,

or a

nnui

ties

cont

ract

ed b

y em

ploy

er o

n be

half

of h

is e

mpl

oyee

s

Prov

isio

n or

not

ice

atta

ched

to

cont

ract

10 d

ays

Prem

ium

, in

clud

ing

cont

ract

fee

s or

cha

rges

. Fo

r a

variab

le a

nnui

ty,

a re

fund

equ

al t

o su

m o

f (i

) di

ffer

ence

bet

wee

n pr

emiu

ms

paid

incl

udin

g co

ntra

ct fee

s or

oth

er

serv

ices

and

am

ount

s al

loca

ted

to s

epar

ate

acco

unts

and

(ii)

cas

h va

lue

or,

if co

ntra

ct d

oes

not

have

cas

h va

lue,

the

re

serv

e fo

r co

ntra

ct,

on

date

ret

urn

cont

ract

is

rece

ived

by

insu

rer

or

agen

t

215

ILCS

5/35

5a(5

)(a)

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

polic

ies

Sin

gle

prem

ium

non

rene

wal

pol

icie

sN

otic

e pr

omin

ently

pr

inte

d on

first

pag

e or

att

ache

d to

pol

icy

10 d

ays

Prem

ium

215

ILCS

5/22

4(2

)Rep

lace

men

t of

life

in

sura

nce

Indu

strial

life

, gr

oup

life,

ann

uitie

s,

pure

end

owm

ents

, re

insu

ranc

eIn

pol

icy

or s

epar

ate

notic

e de

liver

ed w

ith

polic

y

20 d

ays

Prem

ium

ININ

Cod

e Ann

. §2

7-1-

12-4

3In

divi

dual

life

insu

ranc

e an

d in

divi

dual

var

iabl

e lif

e in

sura

nce

Cre

dit

life

insu

ranc

ePr

omin

ently

print

ed

on 1

st p

age

10 d

ays

All

mon

ey p

aid

by t

he

polic

yhol

der

IN C

ode

Ann

. §2

7-1-

12.6

-5Ann

uity

con

trac

tsCon

trac

ts is

sued

in c

onne

ctio

n w

ith a

pe

nsio

n, a

nnui

ty,

or q

ualif

ying

pro

fit-

shar

ing

plan

, if

part

icip

atio

n is

a

cond

ition

of em

ploy

men

t

Con

spic

uous

ly p

lace

d on

fac

e pa

ge o

f th

e co

ntra

ct

10 d

ays

Val

ue o

f va

riab

le a

nnui

ty

acco

unt

or t

he m

onie

s pa

id b

y th

e pu

rcha

ser

to

a fix

ed a

ccou

nt in

co

nnec

tion

with

the

is

suan

ce o

f th

e co

ntra

ct

IN C

ode

Ann

. §2

7-8-

12-1

2In

divi

dual

long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 22

0 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

IN C

ode

Ann

. §2

7-8-

12-1

3Lo

ng-t

erm

car

e po

licy

or

cert

ifica

te is

sued

pur

suan

t to

di

rect

res

pons

e so

licita

tion

Prin

ted

on o

r at

tach

ed t

o 1s

t pa

ge30

day

sPr

emiu

m

IN C

ode

Ann

. §2

7-8-

5-20

(a)

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

polic

ies

Direc

t re

spon

se p

olic

ies

Prom

inen

tly p

rint

ed

on 1

st p

age

10 d

ays

Prem

ium

IN C

ode

Ann

. §2

7-8-

5-20

(b)

Direc

t re

spon

se a

ccid

ent

and

heal

th in

sura

nce

polic

ies

Prom

inen

tly p

rint

ed

on 1

st p

age

30 d

ays

Prem

ium

760

IN A

dmin

. Cod

e 1-

16.1

-4

760

IN A

dmin

Cod

e 1-

16.1

-6

Rep

lace

men

t po

licie

sSee

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

sep

arat

e w

ritt

en n

otic

e de

liver

ed w

ith p

olic

y

20 d

ays

Prem

ium

IAIA

Cod

e Ann

. §5

14G

.105

(4)

Indi

vidu

al lo

ng-t

erm

car

e po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

IA C

ode

Ann

. §5

14A.3

(1)(

m)

Indi

vidu

al s

ickn

ess

and

acci

dent

insu

ranc

e po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1st

page

10 d

ays

Prem

ium

IA A

dmin

. Cod

e 19

1-15

.9(5

07B)

Indi

vidu

al li

fe in

sura

nce

or

annu

ity10

day

sPr

emiu

m b

ut if

tr

ansa

ctio

n in

volv

ed a

va

riab

le p

rodu

ct,

amou

nt

to b

e re

fund

ed s

hall

be

dete

rmin

ed a

ccor

ding

to

polic

y la

ngua

ge.

IA A

dmin

. Cod

e 19

1-15

.62

(507

B)

IA A

dmin

. Cod

e 19

1-15

.64

(507

B)

(3)

Gro

up a

nd in

divi

dual

an

nuiti

esReg

iste

red

or n

onre

gist

ered

var

iabl

e an

nuiti

es o

r ot

her

regi

ster

ed

prod

ucts

; im

med

iate

and

def

erre

d an

nuiti

es t

hat

cont

ain

no

nong

uara

ntee

d el

emen

ts;

annu

ities

us

ed t

o fu

nd c

erta

in p

ensi

on p

lans

; st

ruct

ured

set

tlem

ent

annu

ities

; an

d ch

arita

ble

gift

ann

uitie

s

15 d

ays,

whe

n Buy

ers

Gui

de

and

disc

losu

re

docu

men

t ar

e no

t pr

ovid

ed a

t or

bef

ore

time

of

appl

icat

ion

Ann

uity

can

be

retu

rned

“w

ithou

t pe

nalty

.”

Pag

e 22

1 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

IA A

dmin

. Cod

e 19

1-33

.4(5

08A)

(3)(

a)(5

)

Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

of

polic

y

10 d

ays

Ref

und

equa

l to

the

sum

of

: 1)

diff

eren

ce

betw

een

prem

ium

s pa

id

incl

udin

g an

y po

licy

fees

or

oth

er c

harg

es a

nd

amou

nts

allo

cate

d to

se

para

te a

ccou

nts;

and

2)

val

ue o

f am

ount

s al

loca

ted

to s

epar

ate

acco

unts

, on

the

dat

e re

turn

ed p

olic

y is

re

ceiv

ed b

y in

sure

r or

ag

ent

IA A

dmin

. Cod

e 19

1-16

.26(

507B

)(1

)(d)

Rep

lace

men

t lif

e in

sura

nce

and

annu

ities

by

insu

rers

th

at u

se p

rodu

cers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

x A

or C

30 d

ays

Prem

ium

/con

side

ratio

n,

incl

udin

g po

licy

fees

or

char

ges

or, in

the

cas

e of

a v

aria

ble

or m

arke

t va

lue

adju

stm

ent

polic

y,

paym

ent

of t

he c

ash

surr

ende

r va

lue

prov

ided

pl

us t

he fee

s an

d ch

arge

s de

duct

ed fro

m

the

gros

s pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

such

po

licy

or c

ontr

act

Pag

e 22

2 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

KS

KS A

dmin

. Reg

s.

40-2

-15

Indi

vidu

al li

fe p

olic

ies

and

annu

ity c

ontr

acts

Prin

ted

on o

r at

tach

ed t

o 1s

t pa

ge

of p

olic

y in

not

less

th

an 1

0-po

int

bold

pr

int

or in

som

e di

stin

guis

habl

e m

anne

r fr

om o

ther

po

licy

prin

t

10 d

ays

Prem

ium

, bu

t fo

r

variab

le li

fe in

sura

nce

and

annu

ities

, a

refu

nd

equa

l to

sum

of:

(i)

di

ffer

ence

bet

wee

n pr

emiu

ms

paid

, in

clud

ing

polic

y fe

es o

r ot

her

char

ges

and

amou

nts

allo

cate

d to

sep

arat

e ac

coun

ts;

and

(ii)

val

ue

of a

mou

nts

allo

cate

d to

sepa

rate

acc

ount

s on

da

te r

etur

ned

polic

y is

re

ceiv

ed b

y in

sure

r or

its

agen

t

KS A

dmin

. Reg

s.

40-4

-22

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

Trav

el a

ccid

ent

polic

ies

Not

ice

shal

l be

prin

ted

on o

r at

tach

ed t

o 1st

page

of

pol

icy

in n

ot le

ss

than

10

poin

t ty

pe

and

in b

old

face

typ

e or

in s

ome

othe

r m

anne

r th

at

dist

ingu

ishe

s it

from

th

e pr

int

othe

rwis

e ap

pear

ing

in t

he

polic

y

10 d

ays

Prem

ium

KS A

dmin

. Reg

s.

40-4

-37f

(b)

Long

-ter

m c

are

polic

ies

or

cert

ifica

tes

Not

ice

prin

ted

on o

r at

tach

ed t

o 1s

t pa

ge

in b

old

face

typ

e or

ot

her

man

ner

dist

ingu

ishi

ng it

fro

m

othe

r pr

int

30 d

ays

Prem

ium

ref

unde

d w

ithin

10

bus

ines

s da

ys

follo

win

g re

ceip

t of

re

turn

ed p

olic

y by

in

sure

r or

its

agen

t

Pag

e 22

3 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

KS A

dmin

. Reg

s.

40-2

-12

(f)(

4)(A

)Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

sep

arat

e w

ritt

en n

otic

e20

day

sPr

emiu

m,

exce

pt a

s pr

ovid

ed in

KS A

dmin

. Reg

s. 4

0-2-

15w

ith

resp

ect

to a

djus

tmen

ts

nece

ssar

y to

ref

lect

in

vest

men

t risk

on

variab

le a

nnui

ty

cont

ract

s an

d va

riab

le

life

insu

ranc

e po

lices

KY

KY

Rev

. Sta

t. A

nn.

§304

.15-

010

KY

Rev

. Sta

t. A

nn.

§304

.15-

040

KY

Rev

. Sta

t. A

nn.

§304

.15-

050

(2)

Life

insu

ranc

e an

d an

nuity

co

ntra

cts

Rei

nsur

ance

, gr

oup

life

insu

ranc

e,

grou

p an

nuiti

es,

cred

it lif

e, a

nd

polic

ies

issu

ed u

nder

tax

qua

lifie

d pe

nsio

n pl

ans

In p

olic

y10

day

sPr

emiu

m

KY

Rev

. Sta

t. A

nn.

§304

.14-

615

(6)

Long

-ter

m c

are

polic

ies

Gro

up lo

ng-t

erm

car

e po

licie

s as

de

fined

in K

Y Rev

. Sta

t. A

nn

§304

.14-

600

(5)(

a)

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

KY

Rev

. Sta

t. A

nn.

§304

.17-

170

Indi

vidu

al h

ealth

insu

ranc

e po

licie

sN

onre

new

able

acc

iden

t po

licie

sPr

inte

d on

fac

e pa

ge

or f

iling

bac

k of

po

licy

or in

sep

arat

e ride

r at

tach

ed t

o po

licy

whe

n de

liver

ed;

or

notic

e of

pro

visi

on p

rint

ed

or s

tam

ped

on fac

e pa

ge o

r fil

ing

back

10 d

ays

Prem

ium

Pag

e 22

4 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

806

KY

Adm

in.

Reg

s.15

:030

, Sec

tion

3(3)

(a)(

5)

Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

of

each

pol

icy

10 d

ays

To t

he e

xten

t pe

rmitt

ed

by s

tate

law

, re

fund

eq

uals

sum

of

(i)

differ

ence

bet

wee

n pr

emiu

ms

paid

incl

udin

g po

licy

fees

or

othe

r ch

arge

s an

d am

ount

s al

loca

ted

to s

epar

ate

acco

unts

; an

d (i

i) t

he

valu

e of

the

am

ount

s al

loca

ted

to s

epar

ate

acco

unts

, on

the

dat

e th

e re

turn

ed p

olic

y is

re

ceiv

ed b

y th

e in

sure

r or

its

agen

t. U

ntil

stat

e la

w a

utho

rize

s th

is

met

hod,

the

am

ount

of

the

refu

nd is

the

pr

emiu

m.

KY

Rev

. Sta

t. A

nn.

§304

.12-

030

806

KY

Adm

in.

Reg

s.

12:0

80, Sec

tion

5(1)

(d)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Rep

laci

ng in

sure

r m

ust

agre

e in

w

ritin

g w

ith in

sure

d.

30 d

ays

Prem

ium

s or

co

nsid

erat

ions

pai

d,

incl

udin

g an

y po

licy

fees

or

cha

rges

, or

in t

he

case

of a

variab

le o

r m

arke

t ad

just

men

t po

licy

or c

ontr

act,

a

paym

ent

of c

ash

surr

ende

r va

lue

plus

fee

s an

d ot

her

char

ges

dedu

cted

fro

m g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

polic

y or

co

ntra

ct

LALA

Rev

. Sta

t. A

nn.

§22:

931

(A)(

10)

and

(C)

Indi

vidu

al li

fe in

sura

nce

polic

ies

Trip

tra

vel i

nsur

ance

pol

icie

s w

hich

by

the

ir t

erm

s ar

e no

t re

new

able

, in

dust

rial

life

pol

icie

s, g

roup

life

po

licie

s, s

ervi

ce in

sura

nce

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o lif

e po

licie

s

10 d

ays

Prem

ium

Pag

e 22

5 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

LA R

ev. Sta

t. A

nn.

§22:

951

(A)(

8)(a

)Ann

uitie

s or

pur

e en

dow

men

t co

ntra

cts

Sur

vivo

rshi

p an

nuiti

es,

or g

roup

an

nuity

con

trac

ts, ch

arita

ble

gift

an

nuiti

es

Prom

inen

tly p

rint

ed

on o

r at

tach

ed

ther

eto

10 d

ays

Prem

ium

LA R

ev. Sta

t. A

nn.

§22:

973

(7)(

a)In

divi

dual

hea

lth in

sura

nce

if su

ch p

olic

y w

as s

olic

ited

by

dece

ptiv

e ad

vert

isin

g or

ne

gotia

ted

by d

ecep

tive,

m

isle

adin

g, o

r un

true

st

atem

ents

of

insu

rer

or a

ny

agen

t on

beha

lf of

insu

rer

Trav

elin

sura

nce

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o po

licy

10 d

ays

Prem

ium

LA R

ev. Sta

t. A

nn.

§22:

1186

(F)

Long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

LA A

dmin

. Cod

e 37

:XII

I.83

05(A

)(3)

(a)(

i)(e

)

Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

10 d

ays

To e

xten

t pe

rmitt

ed b

y st

ate

law

, re

fund

equ

als

sum

of:

(i)

diff

eren

ce

betw

een

prem

ium

s pa

id

incl

udin

g po

licy

fees

or

othe

r ch

arge

s an

d am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s; a

nd

(ii)

val

ue o

f am

ount

s al

loca

ted

to s

epar

ate

acco

unts

, on

dat

e th

e re

turn

ed p

olic

y is

re

ceiv

ed b

y in

sure

r or

its

agen

t. U

ntil

stat

e la

w

auth

oriz

es t

his

met

hod,

th

e am

ount

of

refu

nd is

th

e pr

emiu

m.

Pag

e 22

6 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

LA A

dmin

. Cod

e 37

:XII

I.89

05,

LA A

dmin

. Cod

e 37

:XII

I.89

11A(5

)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in

App

endi

xA

orC.

30 d

ays

Prem

ium

s or

co

nsid

erat

ions

, in

clud

ing

polic

y fe

es o

r ch

arge

s, o

r fo

r va

riab

le o

r m

arke

t ad

just

men

t po

licy

a pa

ymen

t of

: (i

) th

e ca

sh

surr

ende

r va

lue;

and

(i

i)th

e fe

es a

nd c

harg

es

dedu

cted

fro

m t

he g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

the

polic

y.

ME

ME

Rev

. Sta

t. A

nn.

tit.

24-A

§25

15-A

Indi

vidu

al li

fe in

sura

nce

polic

ies

In p

olic

y or

in

sepa

rate

rid

er

atta

ched

the

reto

; pr

ovis

ion

set

fort

h in

po

licy

unde

r ap

prop

riat

e ca

ptio

n an

d, if

not

print

ed o

n fa

ce o

f po

licy,

ad

equa

te n

otic

e st

ampe

d or

print

ed

cons

picu

ousl

y on

fa

ce p

age

10 d

ays

Prem

ium

ME

Rev

. Sta

t. A

nn.

tit.

24-A

§27

17In

divi

dual

hea

lth in

sura

nce

polic

ies

Non

rene

wab

le a

ccid

ent

polic

ies

and

indi

vidu

al c

redi

t he

alth

insu

ranc

e po

licie

s

In p

olic

y or

in

sepa

rate

rid

er

atta

ched

the

reto

; pr

ovis

ion

set

fort

h in

po

licy

unde

r ap

prop

riat

e ca

ptio

n an

d, if

not

print

ed o

n fa

ce o

f po

licy,

ad

equa

te n

otic

e st

ampe

d or

print

ed

cons

picu

ousl

y on

fa

ce p

age

10 d

ays

Prem

ium

ME

Rev

. Sta

t. A

nn.

tit.

24-A

§50

75(4

)Lo

ng-t

erm

car

e po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 22

7 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

Cod

e M

E R. 02

-031

Ch.

915

§3

Cod

e M

E R. 02

-031

Ch.

915

§5

(A)(

3)

Indi

vidu

al a

nd g

roup

an

nuiti

esReg

iste

red

or n

on-r

egis

tere

d va

riab

le

annu

ities

or

othe

r re

gist

ered

pr

oduc

ts;

imm

edia

te a

nd d

efer

red

annu

ities

tha

t co

ntai

n no

no

ngua

rant

eed

elem

ents

; an

nuiti

es

used

to

fund

cer

tain

pen

sion

pla

ns;

stru

ctur

ed s

ettle

men

t an

nuiti

es;

and

fund

ing

agre

emen

ts.

A p

rom

inen

t no

tice

of t

he fre

e lo

ok

period

sha

ll be

pr

ovid

ed t

o th

e ap

plic

ant.

15 d

ays,

whe

nBuy

er’s

Gui

de

and

disc

losu

re

docu

men

t ar

e no

t pr

ovid

ed a

t or

bef

ore

time

of

appl

icat

ion

Ret

urn

of a

nnui

ty

cont

ract

“w

ithou

t pe

nalty

”

Cod

e M

E R. 02

-031

Ch.

919

§1

(C)

Cod

e M

E R. 02

-031

Ch.

919

§5

(A)(

4)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in A

ppen

dix

A o

r C.

30 d

ays

Prem

ium

s or

co

nsid

erat

ions

pai

d,

incl

udin

g po

licy

fees

or

char

ges

or, in

cas

e of

va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct, pa

ymen

t of

ca

sh s

urre

nder

val

ue

plus

fee

s an

d ot

her

char

ges

dedu

cted

fro

m

gros

s pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

polic

y or

co

ntra

ct

MD

MD

Cod

e Ann

. In

sura

nce

§16-

101

MD

Cod

e Ann

. In

sura

nce

§16-

105

(b)

Life

insu

ranc

e po

licie

s an

d an

nuity

con

trac

ts

Rei

nsur

ance

, gr

oup

life

insu

ranc

e,

grou

p an

nuiti

es,

cont

ract

s is

sued

to

an e

mpl

oyee

in c

onne

ctio

n w

ith t

he

fund

ing

of a

pen

sion

ann

uity

, ce

rtai

n re

tirem

ent

plan

s or

pro

fit-s

haring

pl

an if

par

ticip

atio

n is

a c

ondi

tion

or

empl

oym

ent

Att

ache

d to

or

prom

inen

tly p

rint

ed

on f

ace

of p

olic

y or

co

ntra

ct

10 d

ays

Pro

rata

pre

miu

m f

or t

he

unex

pire

d te

rm o

f th

e po

licy

or a

nnui

ty

cont

ract

MD

Cod

e Ann

. In

sura

nce

§15-

201

(h)

Indi

vidu

al h

ealth

insu

ranc

e po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o fa

ce o

f po

licy

10 d

ays

Pro

rata

pre

miu

m f

or

unex

pire

d te

rm

Pag

e 22

8 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

MD

Cod

e Ann

. In

sura

nce

§18-

119

Long

-ter

m c

are

polic

ies

Plan

s un

der

§ 12

5 of

the

Int

erna

l Rev

enue

Cod

e (c

afet

eria

pla

ns)

In p

olic

y30

day

sPr

emiu

ms

paid

, al

l m

oney

s to

be

refu

nded

w

ithin

30

busi

ness

day

s af

ter

rece

ipt

of n

otic

e of

su

rren

der

MD

Reg

s. C

ode

31.0

9.02

.04

(D)(

1)(e

)Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

45 d

ays

on d

ate

of e

xecu

tion

of

appl

icat

ion;

or

with

in 1

0 da

ys o

f re

ceip

t by

po

licyh

olde

r,

whi

chev

er is

la

ter

Prem

ium

MD

Reg

s.

Cod

e31

.14.

01.0

4(J

)Lo

ng-t

erm

car

e po

licie

sEm

ploy

er-e

mpl

oyee

gro

up p

olic

ies,

ca

fete

ria

plan

issu

ed u

nder

§ 1

25 o

f th

e In

tern

al R

even

ue C

ode

Prom

inen

tly p

rint

ed

on 1

st p

age

of p

olic

y30

day

sPr

emiu

m

MD

Reg

s. C

ode

31.1

5.04

.03

MD

Reg

s. C

ode

31.1

5.04

.05

Indi

vidu

al d

efer

red

annu

ities

or

depo

sit

fund

sac

cept

ed in

co

njun

ctio

nw

ithin

divi

dual

lif

e in

sura

nce

polic

ies

or w

ith

annu

ity c

ontr

acts

tha

t ar

e su

bjec

t to

cha

pter

Cer

tain

em

ploy

er-p

aid

grou

p an

nuity

co

ntra

cts;

var

iabl

e an

nuiti

es,

inve

stm

ent

annu

ities

; Im

med

iate

an

nuity

con

trac

ts;

a si

ngle

adv

ance

pa

ymen

t of

spe

cific

pre

miu

ms

equa

l to

the

dis

coun

ted

valu

e of

the

se

prem

ium

s; a

pol

icyh

olde

r's

depo

sit

acco

unt

esta

blis

hed

prim

arily

to

faci

litat

e pa

ymen

t of

reg

ular

pr

emiu

ms

In c

ontr

act

or p

olic

y or

in c

ontr

act

sum

mar

y

10 d

ays,

whe

n co

ntra

ct

sum

mar

y is

not

pr

ovid

ed b

efor

e ac

cept

ing

appl

ican

t's in

itial

co

nsid

erat

ion

for

annu

ity c

ontr

act

“Unc

ondi

tiona

l ref

und”

Pag

e 22

9 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

MD

Reg

s.

Cod

e31

.09.

05.0

2(B

)

MD

Reg

s. C

ode

31.0

9.05

.06

(A)(

5)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

usi

ng p

rodu

cers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In n

otic

e to

ow

ner

of

polic

y or

con

trac

t 30

day

sPr

emiu

ms

or

cons

ider

atio

ns,

incl

udin

g po

licy

fees

or

char

ges,

bu

t fo

r va

riab

le li

fe

insu

ranc

e po

licy

or

variab

le a

nnui

ty

cont

ract

, a

paym

ent

of:

(i)

cash

sur

rend

er v

alue

; an

d (i

i) f

ees

and

char

ges

dedu

cted

fro

m g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

the

variab

le li

fe in

sura

nce

polic

y or

var

iabl

e an

nuity

co

ntra

ct,

incl

udin

g su

rren

der

char

ges

MA

MA G

en.

Law

s Ann

. ch

. 17

5 §1

87H

Indi

vidu

al li

fe p

olic

ies

with

fa

ce a

mou

nt le

ss t

han

$25,

000

Prin

ted

on o

r at

tach

ed t

o po

licy

10 d

ays

Prem

ium

211

CM

R 4

2.05

(1)(

e)In

divi

dual

acc

iden

t an

d si

ckne

ss p

olic

ies

Not

spe

cifie

d10

day

sN

ot s

peci

fied

211

CM

R95

.08

(1)(

g)Var

iabl

e lif

e in

sura

nce

polic

ies

Cap

tione

d on

cov

er

page

10 d

ays

Prem

ium

211

CM

R34

.06

(1)(

d)Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

usi

ng a

gent

s or

br

oker

s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

in

sepa

rate

writt

en

notic

e de

liver

ed w

ith

polic

y

20 d

ays

Prem

ium

MI

MI

Com

p. L

aws

Ann

. §5

00.4

000

(1)

and

(2)

MI

Com

p. L

aws

Ann

. §5

00.4

015

Indi

vidu

al li

fe in

sura

nce

Gro

up in

sura

nce,

rei

nsur

ance

, in

dust

rial

life

pol

icie

s, a

nnui

ties

Con

tain

ed in

pol

icy

on fro

nt p

age,

pr

inte

d or

sta

mpe

d an

d m

ade

a pe

rman

ent

part

of

polic

y

10 d

ays

Prem

ium

, in

clud

ing

polic

y fe

es o

r ch

arge

s

Pag

e 23

0 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

MI

Com

p. L

aws

Ann

. §5

00.4

073

Ann

uity

con

trac

tsPo

licie

s or

con

trac

ts is

sued

to

an

empl

oyee

in c

onne

ctio

n w

ith t

he

fund

ing

of a

pen

sion

, an

nuity

, or

qu

alifi

ed p

rofit

-sha

ring

pla

n if

part

icip

atio

n is

con

ditio

n of

em

ploy

men

t

Con

tain

ed in

pol

icy

on fro

nt p

age,

pr

inte

d or

sta

mpe

d an

d m

ade

a pe

rman

ent

part

of

polic

y

10 d

ays

Prem

ium

, in

clud

ing

polic

y fe

es o

r ch

arge

s

MI

Com

p. L

aws

Ann

. §5

00.3

409

(1)

Dis

abili

ty in

sura

nce

Gro

up a

nd b

lank

etCon

tain

ed in

pol

icy

on fro

nt p

age,

pr

inte

d or

sta

mpe

d an

d m

ade

a pe

rman

ent

part

of

polic

y

10 d

ays

Prem

ium

, in

clud

ing

polic

y fe

es o

r ch

arge

s bu

t if

canc

elle

d af

ter

the

10-d

ay p

erio

d, a

pro

rat

a sh

are

of t

he p

rem

ium

is

refu

nded

MI

Com

p. L

aws

Ann

. §5

00.3

409

(2)

MI

Bul

letin

92-

01

Indi

vidu

al a

nd g

roup

di

sabi

lity

insu

ranc

e fo

r pe

ople

elig

ible

for

Med

icar

e

Pr

inte

d or

sta

mpe

d on

fro

nt p

age

and

mad

e a

perm

anen

t pa

rt o

f po

licy

30 d

ays

Prem

ium

, in

clud

ing

polic

y fe

es o

r ch

arge

s bu

t if

canc

elle

d af

ter

the

30-d

ay p

erio

d, a

pro

rat

a sh

are

of t

he p

rem

ium

is

refu

nded

MI

Com

p. L

aws

Ann

. §5

00.3

943

Long

-ter

m c

are

insu

ranc

e,

incl

udin

g di

rect

res

pons

e Pr

omin

ently

print

ed

on 1

st p

age

and

in

sum

mar

y of

co

vera

ge

30 d

ays

Prem

ium

MI

Adm

in.

Cod

e50

0.85

0(a

)(iv

)Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on t

he c

over

pag

e or

pa

ges

corr

espo

ndin

g to

the

cov

er p

age

With

in 4

5 da

ys

of t

he e

xecu

tion

of t

he a

pplic

atio

n or

with

in 1

0 da

ys

of r

ecei

pt,

whi

chev

er is

la

ter

Prem

ium

Pag

e 23

1 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

MN

MN

Sta

t. A

nn.

§60A

.06

(4)

MN

Sta

t. A

nn.

§72A

.51

(Sub

divi

sion

3)

MN

Sta

t. A

nn.

§72A

.52

Life

and

end

owm

ent

insu

ranc

e; a

nnui

ties;

and

, in

su

ch c

ontr

acts

, or

in

cont

ract

s su

pple

men

tal

ther

eto,

add

ition

al b

enef

its

in e

vent

of de

ath

of t

he

insu

red

by a

ccid

enta

l m

eans

, to

tal p

erm

anen

t di

sabi

lity

of t

he in

sure

d, o

r sp

ecifi

c di

smem

berm

ent

or

disa

blem

ent

suffer

ed b

y th

e in

sure

d, o

r ac

cele

ratio

n of

lif

e or

end

owm

ent

or a

nnui

ty

bene

fits

in a

dvan

ce o

f th

e tim

e th

ey w

ould

oth

erw

ise

be p

ayab

le

Incl

ude

a no

tice,

clea

rly

and

cons

picu

ousl

y in

m

inim

um 1

0-po

int

bold

fac

e ty

pe in

co

ntra

ct a

nd it

mus

t in

clud

e ce

rtai

n el

emen

ts li

sted

in

MN

Sta

t. A

nn.

§72A

.52

A m

inim

um o

f 10

da

ys;

a m

inim

um o

f 30

da

ys if

the

pol

icy

is a

rep

lace

men

tpo

licy.

(S

ee M

N B

ulle

tin

2007

-2fo

r ex

plan

atio

n of

in

cons

iste

ncie

s be

twee

n re

plac

emen

t po

licy

prov

isio

ns

in M

N S

tat.

Ann

. §7

2A.5

2an

d

MN

Sta

t. A

nn.

§61A

.57.

)

Prem

ium

, bu

t fo

r va

riab

le a

nnui

ty,

a re

fund

equ

al t

o su

m o

f (i

) di

ffer

ence

bet

wee

n pr

emiu

ms

incl

udin

g co

ntra

ct fee

s or

oth

er

char

ges

and

amou

nts

allo

cate

d to

sep

arat

e ac

coun

ts a

nd (

ii) c

ash

valu

e, o

r, if

no

cash

va

lue,

res

erve

for

the

co

ntra

ct, on

dat

e re

turn

ed c

ontr

act

is

rece

ived

by

insu

rer

or it

s ag

ent.

MN

Sta

t. A

nn.

§62A

.50

(Sub

divi

sion

2)

Long

-ter

m c

are

polic

ies

on

nong

roup

bas

is,

incl

udin

g di

rect

res

pons

e

Prom

inen

tly p

rint

ed

on 1

st p

age

30 d

ays

Prem

ium

Min

n. R

. 27

50.1

300

(A)(

5)Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

10 d

ays

Ref

und

as r

equi

red

by

stat

e la

w (

see

MN

Sta

t. A

nn. §7

2A.5

1)

MN

Sta

t. A

nn.

§61A

.53

MN

Sta

t. A

nn.

§61A

.54

MN

Sta

t. A

nn.

§61A

.57

(d)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

con

trac

t or

in a

sep

arat

e w

ritt

en n

otic

e de

liver

ed w

ith p

olic

y or

con

trac

t

30 d

ays

Prem

ium

Pag

e 23

2 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

MS

MS C

ode

Ann

. §8

3-7-

51In

divi

dual

life

insu

ranc

e

[Not

e th

at t

he c

lass

ifica

tion

of a

life

insu

ranc

e co

mpa

ny

in M

S C

ode

Ann

. §8

3-19

-1in

clud

es t

he d

efin

ition

of an

in

sura

nce

cont

ract

as

one

for

the

“pay

men

t of

en

dow

men

ts o

r an

nuiti

es.”

]

Prin

ted

on o

r at

tach

ed t

o po

licy

10 d

ays

Prem

ium

MS C

ode

Ann

. §8

3-9-

25In

divi

dual

acc

iden

t an

d he

alth

pol

icy

or s

ervi

ce

cont

ract

Trav

el a

nd n

onre

new

able

acc

iden

t po

licie

sPr

inte

d on

or

atta

ched

to

polic

y10

day

sPr

emiu

m

MS A

DC I

NS

84-1

01R

ule

5.0

5 (

C)(

1)(

e)Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

of

polic

y

10 d

ays

To t

he e

xten

t pe

rmitt

ed

by s

tate

law

, th

e re

fund

eq

uals

the

sum

of (i

) th

e di

ffer

ence

bet

wee

n pr

emiu

ms

paid

incl

udin

g po

licy

fees

or

othe

r ch

arge

s an

d th

eam

ount

s al

loca

ted

to

sepa

rate

acc

ount

s; a

nd

(ii)

the

val

ue o

f th

e am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s, o

n th

e da

te t

he r

etur

ned

polic

y is

rec

eive

d by

the

in

sure

r or

its

agen

t. U

ntil

stat

e la

w a

utho

rize

s th

is

met

hod,

the

am

ount

of

the

refu

nd is

the

pr

emiu

m.

MS A

DC I

NS

LA&

H

90-1

02

Ru

le 8

.06

(D)

Long

-ter

m c

are

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 23

3 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

MS A

DC I

NS

99-2

R

ule

14

.01

an

d 1

4.0

5 (

A)(

4)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

tha

t us

e pr

oduc

ers,

incl

udin

g th

ose

issu

ed p

ursu

ant

to

dire

ct r

espo

nse

solic

itatio

n

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

x A.

30 d

ays

Prem

ium

/con

side

ratio

n,

incl

udin

g an

y po

licy

fees

or

cha

rges

or,

in c

ase

of

variab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct, pa

ymen

t of

ca

sh s

urre

nder

val

ue

plus

fee

s an

d ot

her

char

ges

dedu

cted

fro

m

gros

s pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

polic

y

MO

MO

Ann

. Sta

t.

§376

.706

(1)

MO

Ann

. Sta

t.

§376

.702

Life

insu

ranc

eAnn

uitie

s, c

redi

t lif

e in

sura

nce,

gro

up

life

insu

ranc

e po

licie

s is

sued

in

conn

ectio

n w

ith p

ensi

on a

nd w

elfa

re

plan

s as

def

ined

by

and

subj

ect

to

ERIS

A, va

riab

le li

fe in

sura

nce

whe

re

deat

h be

nefit

s an

d ca

sh v

alue

s va

ry

in a

ccor

danc

e w

ith u

nit

valu

es o

f in

vest

men

ts h

eld

in a

sep

arat

e ac

coun

t

In p

olic

y or

pol

icy

sum

mar

yAt

leas

t 10

day

s (I

f no

un

cond

ition

al

refu

nd

prov

isio

n/of

fer

the

insu

rer

shal

l pr

ovid

e to

all

pros

pect

ive

purc

hase

rs a

Buy

er's

Gui

de

and

a Po

licy

Sum

mar

y pr

ior

to a

ccep

ting

appl

ican

t's

prem

ium

or

prem

ium

de

posi

t.)

Prem

ium

MO

Ann

. Sta

t.

§376

.110

9(1

1)Lo

ng-t

erm

car

e po

licie

s Cer

tain

em

ploy

er g

roup

long

-ter

m

care

pol

icie

s as

def

ined

in M

O A

nn.

Sta

t. §

376.

1100

(2)(

4)(a

)

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

20 M

O C

ode

Reg

s.40

0-1.

010

(1)(

D)

Indi

vidu

al li

fe in

sura

nce

and

annu

ities

and

all

mas

s m

arke

ted

or in

divi

dual

ly

solic

ited

grou

p lif

e in

sura

nce

or a

nnui

ty c

ertif

icat

es for

w

hich

the

insu

red

pays

the

en

tire

prem

ium

Gro

up p

olic

ies;

life

pol

icie

s is

sued

to

colle

ge s

tude

nts;

sin

gle

prem

ium

sh

ort

dura

tion

trav

el c

over

age;

ce

rtai

n gr

aded

ben

efit

life

polic

ies

In p

olic

y10

day

sPr

emiu

m

Pag

e 23

4 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

20 M

O C

ode

Reg

s.40

0-1.

030

(3)(

C)(

1)(E

)

Var

iabl

e lif

e in

sura

nce

Cap

tione

d on

cov

er

page

10 d

ays

To t

he e

xten

t pe

rmitt

ed

by s

tate

law

, th

e re

fund

eq

uals

the

sum

of (i

) th

e di

ffer

ence

bet

wee

n pr

emiu

ms

paid

incl

udin

g po

licy

fees

or

othe

rch

arge

s an

d th

e am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s; a

nd

(ii)

the

val

ue o

f th

e am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s, o

n th

e da

te t

he r

etur

ned

polic

y is

rec

eive

d by

the

in

sure

r or

its

agen

t. U

ntil

stat

e la

w a

utho

rize

s th

is

met

hod,

the

am

ount

of

the

refu

nd is

the

pr

emiu

m.

20 M

O C

ode

Reg

s.

400-

2.01

0In

divi

dual

acc

iden

t an

d si

ckne

ss p

olic

ies

and

grou

p ac

cide

nt a

nd s

ickn

ess

cert

ifica

tes

that

are

mas

s m

arke

ted

or m

arke

ted

on

indi

vidu

al b

asis

Sin

gle

prem

ium

sho

rt-d

urat

ion

trip

or

trav

el t

ype

cove

rage

Con

spic

uous

ly a

nd

clea

rly

capt

ione

d on

fa

ce p

age

of p

olic

y or

con

trac

t

10 d

ays

Prem

ium

20 M

O C

ode

Reg

s.40

0-5.

400

(4)

and

(7)(

D)

Rep

lace

men

t of

life

in

sura

nce

or a

nnui

ties

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

in

sepa

rate

writt

en

notic

e de

liver

ed w

ith

polic

y

20 d

ays

Prem

ium

MT

MT

Cod

e Ann

. §3

3-15

-415

Indi

vidu

al li

fe o

r di

sabi

lity

polic

ies

Sin

gle

prem

ium

non

rene

wab

le

disa

bilit

y po

licie

sIn

pol

icy

10 d

ays

Prem

ium

MT

Cod

e Ann

. §3

3-22

-111

9In

divi

dual

long

-ter

m c

are

polic

ies,

incl

udin

g di

rect

re

spon

se

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o

1st

page

30 d

ays

Prem

ium

Pag

e 23

5 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

MT

Adm

in. R. 6.

6.80

3

MT

Adm

in. R. 6.

6.80

5(1

)(b)

Ann

uitie

s Reg

iste

red

or n

on-r

egis

tere

d va

riab

le

annu

ities

or

othe

r re

gist

ered

co

ntra

cts;

imm

edia

te a

nd d

efer

red

annu

ities

tha

t co

ntai

n no

non

-gu

aran

teed

ele

men

ts;

annu

ities

use

d to

fun

d ce

rtai

n pe

nsio

n pl

ans;

st

ruct

ured

set

tlem

ent

annu

ities

;

char

itabl

e gi

ft a

nnui

ties;

and

fu

ndin

g ag

reem

ents

15 d

ays,

whe

n a

buye

r's

guid

e an

d di

sclo

sure

do

cum

ent

are

not

prov

ided

at

or b

efor

e th

e tim

e of

ap

plic

atio

n

Ret

urn

of c

ontr

act

“with

out

pena

lty”

MT

Adm

in. R. 6.

6.30

4

MT

Adm

in. R. 6.

6.30

6(1

)(d)

Rep

lace

men

t of

life

in

sura

nce

polic

ies

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

inApp

endi

xA

or C

30

day

sPr

emiu

m/c

onsi

dera

tion,

in

clud

ing

polic

y fe

es o

r ch

arge

s or

, in

cas

e of

va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct, pa

ymen

t of

ca

sh s

urre

nder

val

ue o

r co

ntra

ct p

lus

fees

and

ot

her

char

ges

dedu

cted

fr

om g

ross

pre

miu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

polic

y

NE

NE

Rev

. St.

§4

4-50

2.05

Indi

vidu

al li

fe in

sura

nce

and

annu

ities

Cre

dit

life

polic

ies

In p

olic

y or

print

ed

on f

ace

10 d

ays

Prem

ium

NE

Rev

. St.

§4

4-45

15Lo

ng-t

erm

car

e po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

NE

Rev

. St.

§4

4-71

0.18

Indi

vidu

al s

ickn

ess

and

acci

dent

insu

ranc

e po

licie

sSin

gle-

prem

ium

non

rene

wab

le

polic

ies

Prin

ted

on f

ace

or

atta

ched

to

polic

y10

day

sPr

emiu

m

Pag

e 23

6 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

210

NE

ADC C

h. 1

9 §0

03

210

NE

ADC C

h. 1

9 §0

0900

9.01

D

Rep

lace

men

t of

life

insu

ranc

e an

d an

nuiti

es b

y in

sure

rs t

hat

use

prod

ucer

s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

x A

or C

30da

ysPr

emiu

ms

or

cons

ider

atio

ns p

aid,

in

clud

ing

any

polic

y fe

es

or c

harg

es o

r, in

the

ca

se o

f a

variab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

con

trac

t, a

pa

ymen

t of

the

cas

h su

rren

der

valu

e pr

ovid

ed

unde

r th

e po

licy

or

cont

ract

plu

s th

e fe

es

and

othe

r ch

arge

s de

duct

ed fro

m t

he g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d

NV

NV S

T §6

88A.0

10

NV S

T §6

88A.1

65

Life

insu

ranc

e, p

ure

endo

wm

ent

cont

ract

s an

d an

nuiti

es

Rei

nsur

ance

, gr

oup

life

insu

ranc

e,

grou

p an

nuiti

es,

and

indu

strial

life

in

sura

nce

In c

ontr

act

or p

olic

y,

or n

otic

e at

tach

ed t

o co

ntra

ct o

r po

licy

10 d

ays

Prem

ium

, in

clud

ing

cont

ract

or

polic

y fe

es o

r ch

arge

s

NV A

dmin

. Cod

e 68

6A.4

15

NV A

dmin

. Cod

e 68

6A.4

30

Life

insu

ranc

eAnn

uitie

s; c

redi

t lif

e in

sura

nce;

gro

up

life

insu

ranc

e; li

fe in

sura

nce

polic

ies

issu

ed in

con

nect

ion

with

cer

tain

pe

nsio

n an

d w

elfa

re p

lans

; va

riab

le

life

insu

ranc

e un

der

whi

ch t

he d

eath

be

nefit

s an

d ca

sh v

alue

s va

ry in

ac

cord

ance

with

uni

t va

lues

of

inve

stm

ents

hel

d in

a s

epar

ate

acco

unt

In p

olic

y or

pol

icy

sum

mar

y12

day

s,w

hen

a bu

yer’

s gu

ide

and

sum

mar

y ar

e no

t de

liver

ed

befo

re a

ccep

ting

appl

ican

ts in

itial

pr

emiu

m o

r pr

emiu

m d

epos

it

Unc

ondi

tiona

l ref

und

NV S

T §6

89A.1

70In

divi

dual

hea

lth in

sura

nce

polic

ies

Non

rene

wab

le a

ccid

ent

polic

ies

and

indi

vidu

al c

redi

t he

alth

insu

ranc

e po

licie

s

In p

olic

y or

in

sepa

rate

rid

er

atta

ched

to

polic

y w

hen

deliv

ered

, ca

ptio

ned

and

prin

ted

on fac

e pa

ge

or n

otic

e of

pro

visi

on

prin

ted

or s

tam

ped

on f

ace

page

10 d

ays

Prem

ium

Pag

e 23

7 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

NV A

dmin

. Cod

e68

7B.0

60In

divi

dual

long

-ter

m c

are

insu

ranc

e co

ntra

cts

or

cert

ifica

tes

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

NV A

dmin

. Cod

e 68

8A.1

15

NV A

dmin

. Cod

e 68

8A.1

20

Ann

uitie

s; d

epos

it fu

nds

acce

pted

in c

onju

nctio

n w

ith

indi

vidu

al li

fe in

sura

nce

polic

ies

or w

ith a

nnui

ty

cont

ract

s w

hich

are

sub

ject

to

NV

Adm

in.

Cod

e 68

8A.1

10to

NV A

dmin

. Cod

e 68

8A.1

80;

indi

vidu

al

defe

rred

ann

uitie

s ot

her

than

var

iabl

e an

nuiti

es,

inve

stm

ent

annu

ities

and

co

ntra

cts

regi

ster

ed w

ith t

he

SEC

; an

d ce

rtai

n de

posi

t fu

nd a

rran

gem

ents

Empl

oyer

-pai

d gr

oup

annu

ities

; im

med

iate

ann

uitie

s; p

olic

ies

or

cont

ract

s is

sued

in c

onne

ctio

n w

ith

cert

ain

pens

ion

plan

s; a

sin

gle

adva

nce

paym

ent

of s

peci

fic

prem

ium

s eq

ual t

o th

e di

scou

nted

va

lue

of t

he p

rem

ium

s; o

r a

polic

yhol

der's

depo

sit

acco

unt

esta

blis

hed

cert

ain

cond

ition

s

In p

olic

y, c

ontr

act,

or

con

trac

t su

mm

ary

10 d

ays,

whe

n no

con

trac

t su

mm

ary

is

prov

ided

bef

ore

acce

ptin

g th

e ap

plic

ant's

initi

al

cons

ider

atio

n

“Unc

ondi

tiona

l ref

und”

NV S

T §6

88A.1

65

NV A

dmin

. Cod

e 68

6A.5

40

NV A

dmin

. Cod

e 68

6A.5

63

Rep

lace

men

t of

ann

uity

co

ntra

ct, pu

re e

ndow

men

t co

ntra

ct o

r po

licy

of li

fe

insu

ranc

e

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In c

ontr

act

or p

olic

y,

or n

otic

e at

tach

ed t

o co

ntra

ct o

r po

licy

30 d

ays

Prem

ium

, in

clud

ing

cont

ract

or

polic

y fe

es o

r ch

arge

s

NH

NH

Rev

. Sta

t. A

nn.

§415

-D:2

NH

Rev

. Sta

t. A

nn.

§415

-D:7

Indi

vidu

al lo

ng-t

erm

car

e po

licie

s or

gro

up c

ertif

icat

es

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

NH

Cod

e Ad

min

. R.

Ins

401.

04(f

)In

divi

dual

life

pol

icie

s an

d in

divi

dual

ann

uity

con

trac

tsIn

con

spic

uous

pla

ce

on f

ace

page

of

polic

y

10 d

ays

Prem

ium

Pag

e 23

8 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

NH

Cod

e Ad

min

. R.

Ins

306.

03

NH

Cod

e Ad

min

. R.

Ins

306.

06

Ann

uitie

s an

d de

posi

t fu

nds

acce

pted

in c

onju

nctio

n w

ith

indi

vidu

al li

fe in

sura

nce

polic

ies

or w

ith a

nnui

ty

cont

ract

s

Indi

vidu

al d

efer

red

annu

ities

and

gr

oup

annu

ities

whi

ch a

re:

variab

le

annu

ities

; in

vest

men

t an

nuiti

es;

cont

ract

s re

gist

ered

with

the

Fed

eral

Sec

uriti

es a

nd E

xcha

nge

Com

mis

sion

; or

con

trac

ts w

hich

hav

e va

riab

le a

nnui

ty f

eatu

res

avai

labl

e at

th

e op

tion

of t

he c

ontr

act

owne

r;

cert

ain

empl

oyer

-pai

d gr

oup

annu

ities

; im

med

iate

ann

uitie

s;

polic

ies

or c

ontr

acts

issu

ed in

co

nnec

tion

with

cer

tain

pen

sion

pl

ans;

a s

ingl

e ad

vanc

e pa

ymen

t of

sp

ecifi

c pr

emiu

ms

equa

l to

the

disc

ount

ed v

alue

of su

ch p

rem

ium

s;

or a

pol

icyh

olde

r's

depo

sit

acco

unt

esta

blis

hed

unde

r ce

rtai

n ci

rcum

stan

ces.

In c

ontr

act,

pol

icy,

or

pol

icy

sum

mar

y10

day

s, w

hen

no c

ontr

act

sum

mar

y is

pr

ovid

ed b

efor

e ac

cept

ing

the

appl

ican

t's in

itial

co

nsid

erat

ion

“Unc

ondi

tiona

l ref

und”

NH

Cod

e Ad

min

. R.

Ins

1901

.02

NH

Cod

e Ad

min

. R.

Ins

1901

.07

(a)(

11)

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

polic

ies

and

grou

p su

pple

men

tal h

ealth

in

sura

nce

polic

ies

Sin

gle

prem

ium

non

rene

wab

le

polic

ies,

long

-ter

m c

are

insu

ranc

e,

Med

icar

e su

pple

men

tal i

nsur

ance

Prin

ted

on f

irst

pag

e of

pol

icy

or

cert

ifica

te o

r at

tach

ed t

o it

30 d

ays

Prem

ium

NH

Cod

e Ad

min

. R.

Ins

302.

02

NH

Cod

e Ad

min

. R.

Ins

302.

06(a

)(4)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

xA

orC.

30 d

ays

Prem

ium

/con

side

ratio

n,

incl

udin

g po

licy

fees

or

char

ges

or, in

the

cas

e of

a v

aria

ble

or m

arke

t va

lue

adju

stm

ent

polic

y or

con

trac

t, a

pay

men

t of

the

cas

h su

rren

der

valu

e or

con

trac

t pl

us

the

fees

and

oth

er

char

ges

dedu

cted

fro

m

the

gros

s pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

such

po

licy

or c

ontr

act

NJ

NJ

Sta

t. A

nn.

§17B

:25-

2.1

Indi

vidu

al li

fe in

sura

nce

Gro

up in

sura

nce

In p

olic

y or

not

ice

atta

ched

to

polic

y10

day

sPr

emiu

m,

incl

udin

g po

licy

fees

or

char

ges

Pag

e 23

9 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

NJ

Adm

in. Cod

e §1

1:4-

21.3

(g)

Lim

ited

deat

h be

nefit

po

licie

sIn

pol

icy

30 d

ays

Prem

ium

NJ

Adm

in. Cod

e §1

1:4-

34Ap

pend

ix C

Long

-ter

m c

are

insu

ranc

eIn

App

endi

x C

30 d

ays

Prem

ium

NJ

Sta

t. A

nn.

§17B

:26-

3.1

Indi

vidu

al h

ealth

insu

ranc

eG

roup

and

bla

nket

hea

lth in

sura

nce

Not

ice

in o

r at

tach

ed

to p

olic

y10

day

sPr

emiu

m,

polic

y fe

es a

nd

othe

r ch

arge

s

NJ

Adm

in. Cod

e §1

1:4-

2.1

NJ

Adm

in. Cod

e §1

1:4-

2.4

(a)(

5)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in A

ppen

dix

A o

r C.

30 d

ays

Prem

ium

, in

clud

ing

polic

y fe

es o

r ch

arge

s or

, in

cas

e of

var

iabl

e or

m

arke

t va

lue

adju

stm

ent

polic

y or

con

trac

t,

paym

ent

of c

ash

surr

ende

r va

lue

prov

ided

un

der

polic

y or

con

trac

t pl

us fee

s an

d ot

her

char

ges

dedu

cted

fro

m

the

gros

s pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

polic

y or

co

ntra

ct

NJ

Sta

t. A

nn.

§17B

:25-

38

NJ

Sta

t. A

nn.

§17B

:25-

39

NJ

Bul

letin

200

9-6

NJ

Bul

letin

200

9-12

Indi

vidu

al f

ixed

def

erre

d an

d im

med

iate

ann

uity

con

trac

ts

solic

ited

dire

ctly

to

cons

umer

s

In c

ontr

act

or in

an

atta

ched

not

ice

10 d

ays

Acc

ount

val

ue in

clud

ing

cont

ract

fee

s or

oth

er

char

ges

NM

NM

Sta

t. A

nn.

§59A

-23A

-6(E

)Lo

ng-t

erm

car

e po

licie

s,

cert

ifica

tes,

or

ride

rsEm

ploy

er g

roup

pol

icie

s, c

ertif

icat

es

or r

ider

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

, w

ithin

30

days

of

ret

urn

of p

olic

y,

cert

ifica

te o

r ride

r

Pag

e 24

0 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

NM

Adm

in.

Cod

e 13

.9.1

2Sec

tions

13

.9.1

2.2

and

13.9

.12.

8 (C

)

Gro

up a

nd in

divi

dual

an

nuiti

es

Reg

iste

red

or n

on-r

egis

tere

d va

riab

le

annu

ities

or

othe

r re

gist

ered

pr

oduc

ts;

imm

edia

te a

nd d

efer

red

annu

ities

tha

t co

ntai

n no

no

ngua

rant

eed

elem

ents

; an

nuiti

es

used

to

fund

cer

tain

pen

sion

pla

ns;

stru

ctur

ed s

ettle

men

t an

nuiti

es

15 d

ays,

whe

n a

buye

r's

guid

e an

d di

sclo

sure

do

cum

ent

are

not

prov

ided

at

or b

efor

e th

e tim

e of

ap

plic

atio

n

Ret

urn

of c

ontr

act

with

out

pena

lty

NM

Adm

in.

Cod

e 13

.9.5

Sec

tions

13

.9.5

.2 a

nd 1

3.9.

5.9

Life

insu

ranc

eAnn

uitie

s, c

redi

t lif

e in

sura

nce,

gro

up

life

insu

ranc

e, li

fe in

sura

nce

polic

ies

issu

ed in

con

nect

ions

with

pen

sion

an

d w

elfa

re p

lans

, or

var

iabl

e lif

e in

sura

nce

In p

olic

y10

day

s, w

hen

the

Buy

er’s

G

uide

is n

ot

deliv

ered

prior

to

acce

ptan

ce o

f th

e ap

plic

ant’s

in

itial

pre

miu

m

or p

rem

ium

de

posi

t

“Unc

ondi

tiona

l ref

und”

NM

Adm

in.

Cod

e 13

.9.6

Sec

tions

13

.9.6

.2 a

nd

13.9

.6.1

0 (A

)(4)

Rep

lace

men

t of

life

in

sura

nce

or a

nnui

ties

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in A

ppen

dix

Aor

C

30 d

ays

Prem

ium

/con

side

ratio

n,

incl

udin

g po

licy

fees

or

char

ges

or, in

cas

e of

va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y,

paym

ent

of c

ash

surr

ende

r va

lue

or

cont

ract

plu

s fe

es a

nd

othe

r ch

arge

s de

duct

ed

from

gro

ss p

rem

ium

s or

co

nsid

erat

ions

or

impo

sed

unde

r po

licy

Pag

e 24

1 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

NY

NY

Ins.

§32

03(a

)(11

)In

divi

dual

life

insu

ranc

e po

licie

sM

ail o

rder

pol

icie

sIn

pol

icy

or n

otic

e at

tach

ed t

o po

licy

Not

less

tha

n 10

da

ys n

or m

ore

than

30

days

Eith

er (

i) p

rem

ium

, in

clud

ing

polic

y fe

es o

r ot

her

char

ges

or (

ii) if

po

licy

prov

ides

for

ad

just

men

t of

cas

h su

rren

der

bene

fit in

ac

cord

ance

with

a

mar

ket-

valu

e ad

just

men

t fo

rmul

a an

d if

polic

y or

not

ice

atta

ched

to

it so

pr

ovid

es,

amou

nt o

f ca

sh

surr

ende

r be

nefit

as

adju

sted

ass

umin

g no

su

rren

der

char

ge p

lus

amou

nt o

f fe

es a

nd

othe

r ch

arge

s de

duct

ed

prem

ium

pai

d or

fro

m

polic

y va

lue

NY

Ins.

§32

03(a

)(11

)In

divi

dual

life

insu

ranc

e po

licie

s so

ld b

y m

ail o

rder

In p

olic

y or

not

ice

atta

ched

to

polic

y30

day

sSee

abo

ve.

NY

Ins.

§32

09(a

) an

d(d

)(7)

Life

insu

ranc

e, a

nnui

ties,

an

d fu

ndin

g ag

reem

ents

Cre

dit

life

insu

ranc

e; g

roup

life

in

sura

nce;

life

insu

ranc

e, a

nnui

ties

and

fund

ing

agre

emen

ts is

sued

in

conn

ectio

n w

ith c

erta

in p

ensi

on a

nd

wel

fare

pla

ns;

fund

ing

agre

emen

ts

issu

ed t

o ot

her

than

indi

vidu

als

subj

ect

to N

Y In

s. §

3222

(b);

any

gr

oup

annu

ity u

nles

s at

leas

t on

e ce

rtifi

cate

is s

ubje

ct t

o N

Y In

s.

§422

3(b)

(2)

10 d

ays

Pr

emiu

m

NY

Ins.

§32

09(b

)(1)

Direc

t m

ail l

ife in

sura

nce

See

abo

veIn

pol

icy

30 d

ays

(if

no

unco

nditi

onal

re

fund

pro

visi

on,

insu

rer

mus

t in

clud

e Buy

er's

G

uide

in e

ach

initi

al

solic

itatio

n)

Prem

ium

Pag

e 24

2 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

NY

Ins.

§32

19(a

)(9)

Cer

tain

ann

uitie

s an

d pu

re

endo

wm

ents

(ex

cept

as

prov

ided

in N

Y In

s. §

4240

,ev

ery

annu

ity o

r pu

re

endo

wm

ent

cont

ract

exc

ept

a gr

oup

annu

ity c

ontr

act,

an

d ev

ery

grou

p an

nuity

ce

rtifi

cate

to

whi

ch N

Y In

s.

§422

3ap

plie

s by

rea

son

of

subs

ectio

n (b

) th

ereo

f, o

r to

w

hich

§ 4

223

wou

ld a

pply

if

such

cer

tific

ate

wer

e no

t a

variab

le a

nnui

ty)

See

par

enth

etic

al t

ext

in “

appl

ies

to”

colu

mn.

In c

ontr

act

or

cert

ifica

te o

r

atta

ched

not

ice

Not

less

tha

n 10

no

r m

ore

than

30

day

s; 3

0 da

ys

for

dire

ct

resp

onse

co

ntra

ct o

r ce

rtifi

cate

Eith

er (

i) c

onsi

dera

tion,

in

clud

ing

fees

or

othe

r ch

arge

s or

, if

cont

ract

or

cert

ifica

te, or

not

ice

atta

ched

so

prov

ides

, an

d co

ntra

ct o

r ce

rtifi

cate

is s

ubje

ct t

o pr

ovis

ions

of N

Y In

s.

§422

3an

d pr

ovid

es for

de

term

inat

ion

of c

ash

surr

ende

r be

nefit

s in

ac

cord

ance

with

mar

ket-

valu

e ad

just

men

t fo

rmul

a, (

ii) c

ash

surr

ende

r be

nefit

s pr

ovid

ed p

lus

fees

and

ot

her

char

ges

dedu

cted

fr

om g

ross

co

nsid

erat

ions

or

impo

sed

unde

r co

ntra

ct

or c

ertif

icat

e

NY

Ins.

§32

16(c

)(10

)In

divi

dual

acc

iden

t an

d

heal

th in

sura

nce

polic

ies

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

insu

ring

aga

inst

acc

iden

ts

only

or

acci

dent

al b

odily

inju

ries

onl

y

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1st

page

Not

less

tha

n 10

da

ys o

r m

ore

than

20

days

; 30

da

ys f

or m

ail

orde

r, lo

ng-t

erm

ca

re in

sura

nce,

or M

edic

are

supp

lem

enta

l co

ntra

ct o

r ce

rtifi

cate

Prem

ium

, in

clud

ing

polic

y fe

es a

nd o

ther

ch

arge

s

11 N

YCRR

54.6

(b)(

1)(v

)Var

iabl

e lif

e po

licie

sCap

tione

d pr

ovis

ion

on c

over

pag

e 10

day

sPr

emiu

m

11 N

YCRR 5

3-2.

1(a

)(9)

Polic

ies

subj

ect

to N

Y In

s.

Cod

e §4

232

(b)

(ind

ivid

ual

life

polic

ies)

Prel

imin

ary

writt

en

stat

emen

t10

day

sPr

emiu

m p

aid

or

adju

sted

am

ount

if s

uch

polic

y pr

ovid

es for

a

mar

ket-

valu

e ad

just

men

t

Pag

e 24

3 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

11 N

YCRR

51.3

11 N

YCRR 5

1.6

(d)

Rep

lace

men

t of

life

in

sura

nce

polic

ies

and

annu

ity c

ontr

acts

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

App

endi

x 10

C

cont

ains

fre

e lo

ok

stat

emen

t

60 d

ays

Prem

ium

/con

side

ratio

n,

or in

the

cas

e of

a

variab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct,

a pa

ymen

t of

th

e ca

sh s

urre

nder

be

nefit

s pl

us t

he a

mou

nt

of f

ees

and

othe

r ch

arge

s de

duct

ed fro

m

gros

s co

nsid

erat

ions

or

impo

sed

unde

r th

e po

licy

or c

ontr

act;

pay

men

t w

ithin

10

days

of re

ceip

t of

pol

icy

or c

ontr

act

for

canc

ella

tion

NC

NC G

en.

Sta

t.

§58-

55-3

0(f

) an

d (g

)

Indi

vidu

al lo

ng-t

erm

car

e po

licie

s, in

clud

ing

dire

ct

res p

onse

Prom

inen

tly p

rint

ed

on 1

st p

age

or

atta

ched

30 d

ays

Prem

ium

NC G

en.

Sta

t.

§58-

60-5

NC G

en.

Sta

t.

§58-

60-1

5

Life

insu

ranc

eIn

divi

dual

and

gro

up a

nnui

ties;

cre

dit

life

insu

ranc

e; g

roup

life

insu

ranc

e (e

xcep

t fo

r di

sclo

sure

s re

latin

g to

pr

enee

d fu

nera

l con

trac

ts o

r pr

earr

ange

men

ts;

thes

e di

sclo

sure

re

quirem

ents

sha

ll ex

tend

to

the

issu

ance

or

deliv

ery

of c

ertif

icat

es a

s w

ella

s to

the

mas

ter

polic

y);

life

insu

ranc

e po

licie

s is

sued

in

conn

ectio

n w

ith c

erta

in p

ensi

on a

nd

wel

fare

pla

ns;

variab

le li

fe in

sura

nce

unde

r w

hich

the

dea

th b

enef

its a

nd

cash

val

ues

vary

in a

ccor

danc

e w

ith

unit

valu

es o

f in

vest

men

ts h

eld

in a

se

para

te a

ccou

nt.

In p

olic

y or

pol

icy

sum

mar

y10

day

s, w

hen

no B

uyer

's G

uide

an

d a

Polic

y Sum

mar

y ar

e pr

ovid

ed p

rior

to

acce

ptin

g in

itial

pr

emiu

m d

epos

it

Prem

ium

11 N

CAC 1

2.04

47In

divi

dual

life

insu

ranc

e or

an

nuity

, al

so a

pplie

s to

any

gr

oup

life

or a

nnui

ty p

olic

y th

at c

onta

ins

free

look

pr

ovis

ion

Stic

ker

or p

rint

ed o

n fa

ce o

f po

licy

10 d

ays

Prem

ium

Pag

e 24

4 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

11 N

CAC 1

2.04

36(1

)(c)

and

(3)

(a)(

v)Var

iabl

e lif

e in

sura

nce

Var

iabl

e po

licie

s is

sued

in c

onne

ctio

n w

ith q

ualif

ying

pen

sion

, pr

ofit-

shar

ing,

and

ret

irem

ent

plan

s

Cap

tione

d on

cov

er

page

of po

licy

With

in 4

5 da

ys

from

exe

cutio

n of

app

licat

ion

or

with

in 1

0 da

ys o

fre

ceip

t of

pol

icy

by p

olic

yhol

der,

w

hich

ever

is

late

r

Prem

ium

11 N

CAC 1

2.06

01

11 N

CAC 1

2.06

04

11 N

CAC 1

2.06

12(a

)(4)

Rep

lace

men

t of

exi

stin

g lif

e in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

the

notic

e r

equi

red

by 1

1 N

CAC

12.

0611

(ref

eren

ce t

o N

AIC

M

odel

Not

ice)

30 d

ays

Prem

ium

/con

side

ratio

n,

or in

the

cas

e of

a

variab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct,

a pa

ymen

t of

th

e ca

sh s

urre

nder

be

nefit

s pl

us t

he a

mou

nt

of f

ees

and

othe

r ch

arge

s de

duct

ed fro

m

gros

s co

nsid

erat

ions

or

impo

sed

unde

r th

e po

licy

or c

ontr

act

ND

ND

Cen

t. C

ode

§26.

1-33

-02.

1Li

fe in

sura

nce

polic

ies

and

cert

ifica

tes

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

20 d

ays

Prem

ium

ND

Cen

t. C

ode

§26.

1-34

-01.

1Ann

uity

pol

icie

s an

d ce

rtifi

cate

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

20 d

ays

Prem

ium

, ex

cept

va

riab

le a

nnui

ties

whe

re

purc

hase

r is

ent

itled

to

valu

e of

ann

uity

plu

s al

l ex

pens

e ch

arge

s

Pag

e 24

5 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

ND

Cen

t. C

ode

§26.

1-36

-01

ND

Cen

t. C

ode

§26.

1-36

-02.

1

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

polic

ies

and

cert

ifica

tes

Any

pol

icy

of w

orkf

orce

saf

ety

and

insu

ranc

e or

any

pol

icy

of li

abili

ty

insu

ranc

e w

ith o

r w

ithou

t su

pple

men

tary

exp

ense

cov

erag

e;

rein

sura

nce;

bla

nket

or

grou

p in

sura

nce;

life

insu

ranc

e, e

ndow

men

t or

ann

uity

con

trac

ts, or

con

trac

ts

supp

lem

enta

l the

reto

whi

ch c

onta

in

only

suc

h pr

ovis

ions

rel

atin

g to

ac

cide

nt a

nd s

ickn

ess

insu

ranc

e as

pr

ovid

e ad

ditio

nal b

enef

its in

cas

e of

de

ath

or d

ism

embe

rmen

t or

loss

of

sigh

t by

acc

iden

t, o

r as

ope

rate

to

safe

guar

d su

ch c

ontr

acts

aga

inst

la

pse,

or

to g

ive

a sp

ecia

l sur

rend

er

valu

e or

spe

cial

ben

efit

or a

n an

nuity

in

the

eve

nt t

hat

the

insu

red

or

annu

itant

sha

ll be

com

e to

tally

and

pe

rman

ently

dis

able

d, a

s de

fined

by

the

cont

ract

or

supp

lem

enta

l con

trac

t

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays

Prem

ium

ND

Cen

t. C

ode

§26.

1-45

-09

(1)

Long

-ter

m c

are

polic

ies

Gro

up lo

ng-t

erm

car

e ce

rtifi

cate

is

sued

to

a gr

oup

defin

ed in

su

bdiv

isio

n (a

) of

sub

sect

ion

3 of

N

D C

ent.

Cod

e §2

6.1-

45-0

1(c

erta

in

empl

oyer

/lab

or g

roup

s)

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

With

in 3

0 da

ys

of d

ate

of

deliv

ery

or 3

0 da

ys o

f ef

fect

ive

date

, w

hich

ever

oc

curs

late

r

Prem

ium

Pag

e 24

6 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

ND

Adm

in. Cod

e §4

5-04

-04-

03(3

)(a)

(5)

Var

iabl

e lif

e in

sura

nce

polic

ies

Cap

tione

d pr

ovis

ion

on c

over

pag

e of

po

licy

10 d

ays

To e

xten

t pe

rmitt

ed b

y st

ate

law

, re

fund

equ

als

sum

of:

(i)

diff

eren

ce

betw

een

prem

ium

s pa

id

incl

udin

g po

licy

fees

or

othe

r ch

arge

s an

d am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s; a

nd

(ii)

val

ue o

f am

ount

s al

loca

ted

to s

epar

ate

acco

unts

, on

dat

e th

e re

turn

ed p

olic

y is

re

ceiv

ed b

y in

sure

r or

its

agen

t. U

ntil

stat

e la

w

auth

oriz

es t

his

met

hod,

am

ount

of re

fund

is

prem

ium

.

OH

OH

Rev

. Cod

e Ann

. §3

923.

44(H

)In

divi

dual

long

-ter

m c

are

polic

ies

Prin

ted

prom

inen

tly

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

OH

Adm

in.

Cod

e §3

901-

6-03

(C)

and

(E)(

1)(b

)

Life

insu

ranc

eAnn

uitie

s, c

redi

t lif

e in

sura

nce,

gro

up

life

insu

ranc

e, li

fe in

sura

nce

polic

ies

issu

ed in

con

nect

ion

with

pen

sion

and

w

elfa

re p

lans

, or

var

iabl

e lif

e in

sura

nce

In p

olic

y or

pol

icy

sum

mar

y10

day

s, w

hen

the

Buy

er’s

G

uide

and

Pol

icy

Sum

mar

y ar

e no

t de

liver

ed

prio

r to

ac

cept

ance

of

the

appl

ican

t’s

initi

al p

rem

ium

or

pre

miu

m

depo

sit

“Unc

ondi

tiona

l ref

und”

Pag

e 24

7 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

OH

Adm

in.

Cod

e §3

901-

6-08

(E)(

3)(a

)(v)

Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e 10

day

sTo

ext

ent

perm

itted

by

stat

e la

w,

refu

nd e

qual

s su

m o

f (i

) di

ffer

ence

be

twee

n pr

emiu

ms

paid

in

clud

ing

polic

y fe

es o

r ot

her

char

ges

and

amou

nts

allo

cate

d to

se

para

te a

ccou

nts;

and

(i

i) v

alue

of am

ount

s al

loca

ted

to s

epar

ate

acco

unts

, on

dat

e th

e re

turn

ed p

olic

y is

re

ceiv

ed b

y in

sure

r or

its

agen

t. U

ntil

stat

e la

w

auth

oriz

es t

his

met

hod,

am

ount

of re

fund

is

prem

ium

.

OH

Adm

in.

Cod

e §3

901-

6-14

(C)

and

(E)

Gro

up a

nd in

divi

dual

an

nuiti

esVar

iabl

e an

nuiti

es o

r ot

her

regi

ster

ed

prod

ucts

, im

med

iate

and

def

erre

d an

nuiti

es t

hat

cont

ain

no n

on-

guar

ante

ed e

lem

ents

, an

nuiti

es u

sed

to f

und

cert

ain

pens

ion

plan

s an

d

nonq

ualif

ied

defe

rred

com

pens

atio

n ar

rang

emen

ts,

stru

ctur

ed s

ettle

men

t an

nuiti

es,

and

fund

ing

agre

emen

ts.

15 d

ays,

if

buye

r's

guid

e an

d di

sclo

sure

do

cum

ent

are

not

prov

ided

at

or b

efor

e th

e tim

e of

ap

plic

atio

n

Ann

uity

con

trac

t ca

n be

re

turn

ed “

with

out

pena

lty”

Pag

e 24

8 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

OH

Adm

in.

Cod

e §3

901-

6-05

(F)(

1)(d

)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e ag

ents

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

x A

or C

30 d

ays

Prem

ium

or

cons

ider

atio

ns p

aid,

in

clud

ing

any

polic

y fe

es

or c

harg

es o

r, in

the

ca

se o

f a

variab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

con

trac

t, a

pa

ymen

t of

the

cas

h su

rren

der

valu

e pr

ovid

ed

unde

r th

e po

licy

or

cont

ract

plu

s th

e fe

es

and

othe

r ch

arge

s de

duct

ed fro

m t

he g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

such

po

licy

or c

ontr

act

OK

36 O

K Sta

t.Ann

. §4

003.

1In

divi

dual

life

insu

ranc

e or

an

nuiti

esLi

fe in

sura

nce

polic

ies

issu

ed in

co

nnec

tion

with

cre

dit

tran

sact

ion

or

issu

ed u

nder

con

trac

tual

pol

icy

chan

ge o

r co

nver

sion

privi

lege

co

ntai

ned

in p

olic

y

Prin

ted

on o

r at

tach

ed t

o po

licy

10 d

ays

Prem

ium

or

mon

ies

paid

w

ill b

e re

fund

ed b

y in

sure

r w

ithin

30

days

of

canc

ella

tion,

or

insu

rer

shal

l pay

inte

rest

whi

ch

shal

l be

the

sam

e ra

te o

f in

tere

st a

s th

e av

erag

e U

.S.

Trea

sury

Bill

rat

e of

the

prec

edin

g ca

lend

ar

year

plu

s tw

o pe

rcen

tage

po

ints

, w

hich

sha

ll ac

crue

fro

m d

ate

of

canc

ella

tion

until

pr

emiu

ms

or m

oney

s ar

e re

turn

ed.

36 O

K Sta

t. A

nn.

§442

6(E

)Lo

ng-t

erm

car

e po

licie

sPr

omin

ently

print

ed

on 1

st p

age

or

atta

ched

30 d

ays

Prem

ium

Pag

e 24

9 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

OK A

dmin

. Cod

e §3

65:1

0-5-

6(a

)(7)

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

polic

ies

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays,

or

30

days

for

direc

t re

spon

se p

olic

ies

to p

erso

ns

elig

ible

for

M

edic

are

Prem

ium

or

mon

ies

paid

w

ill b

e re

fund

ed b

y in

sure

r w

ithin

30

days

of

canc

ella

tion,

or

insu

rer

shal

l pay

inte

rest

whi

ch

shal

l be

the

sam

e ra

te o

f in

tere

st a

s th

e av

erag

e U

.S.

Trea

sury

Bill

rat

e of

th

e pr

eced

ing

cale

ndar

ye

ar p

lus

two

perc

enta

ge

poin

ts,

whi

ch s

hall

accr

ue fro

m d

ate

of

canc

ella

tion

until

pr

emiu

ms

or m

oney

s ar

e re

turn

ed.

36 O

K Sta

t. A

nn.

§403

4(G

)Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Prom

inen

t w

ritt

en

notic

e at

tach

ed t

o or

as

par

t of

1st

pag

e of

pol

icy

20 d

ays

Prem

ium

OR

OR R

ev. Sta

t.

§743

.655

(6)

Indi

vidu

al lo

ng-t

erm

car

e in

sura

nce

polic

ies

and

cert

ifica

tes

Prom

inen

tlypr

inte

d on

or

atta

ched

to

1st

page

30 d

ays.

Prem

ium

OR R

ev. Sta

t.

§743

.492

Indi

vidu

al h

ealth

insu

ranc

e po

licie

sSin

gle

prem

ium

non

rene

wab

le

polic

ies

Prin

ted

on f

ace

or

atta

ched

to

polic

y10

day

sPr

emiu

m

OR A

dmin

. R. 83

6-05

1-00

05

OR A

dmin

. R. 83

6-05

1-00

15

Indi

vidu

al li

fe in

sura

nce

polic

ies

[Not

e th

at t

he d

efin

ition

of

insu

ranc

e in

OR R

ev. St.

73

1.17

0in

clud

es a

nnui

ties

with

exc

eptio

ns.]

Ann

uitie

s; c

redi

t lif

e in

sura

nce;

gro

up

life

insu

ranc

e; li

fe in

sura

nce

polic

ies

issu

ed in

con

nect

ion

with

cer

tain

em

ploy

ee b

enef

it pl

ans;

and

life

in

sura

nce

polic

ies

that

com

ply

with

O

R A

dmin

. R. 83

6-05

1-05

00to

O

R A

dmin

. R. 83

6-05

1-06

00(i

llust

ratio

ns r

equi

rem

ents

).

In p

olic

y or

pol

icy

sum

mar

y10

day

s, w

hen

Buy

er's

Gui

de

and

a Po

licy

Sum

mar

y ar

e no

t pr

ovid

ed

prio

r to

ac

cept

ing

the

appl

ican

t's in

itial

pr

emiu

m o

r pr

emiu

m d

epos

it

“Unc

ondi

tiona

l ref

und”

Pag

e 25

0 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

OR A

dmin

. R.

836-

080-

0001

(4)

OR A

dmin

. R.

836-

080-

0029

(1)(

d)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e ag

ents

, po

licie

s us

ed t

o fu

nd p

ensi

on

plan

s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

xA

orC.

30 d

ays

Prem

ium

/con

side

ratio

n,

incl

udin

g po

licy

fees

or

char

ges

or, in

cas

eof

va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct, pa

ymen

t of

ca

sh s

urre

nder

val

ue o

r co

ntra

ct p

lus

fees

and

ot

her

char

ges

dedu

cted

fr

om g

ross

pre

miu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

such

po

licy

or c

ontr

act

PA40

PA

Con

s. S

tat.

Ann

. §5

10c

(a)(

1)

Indi

vidu

al f

ixed

dol

lar

life

insu

ranc

e or

end

owm

ent

polic

es

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays

Prem

ium

40 P

A Con

s. S

tat.

Ann

. §5

10c

(a)(

2) a

nd (

b)(2

)

Rep

lace

men

ts o

f ex

istin

g lif

e in

sura

nce

polic

y or

ann

uity

co

ntra

cts

with

in

divi

dual

va

riab

le li

fe in

sura

nce

polic

ies,

indi

vidu

al f

ixed

do

llar

life

insu

ranc

e or

en

dow

men

t po

licie

s by

the

sa

me

insu

rer

or in

sure

r gr

oup

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o

1st

page

45 d

ays

Prem

ium

, bu

t fo

r va

riab

le li

fe,

an a

mou

nt

equa

l to

any

of t

he

follo

win

g: (

i) t

he

stip

ulat

ed p

aym

ent/

pr

emiu

m;

(ii)

the

di

ffer

ence

bet

wee

n: (

A)

prem

ium

s, in

clud

ing

polic

y fe

es o

r ot

her

char

ges

and

the

amou

nts

allo

cate

d to

se

para

te a

ccou

nts;

and

(B

) th

e ca

sh v

alue

or,

if

the

polic

y do

es n

ot h

ave

a ca

sh v

alue

, th

e re

serv

e on

the

dat

e of

sur

rend

er

attr

ibut

able

to

the

amou

nts

so a

lloca

ted;

or

(iii)

the

gre

ater

of

subp

arag

raph

(i)

or

(ii)

Pag

e 25

1 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

40 P

A Con

s. S

tat.

Ann

. §5

10c

(a)(

3) a

nd (

b)(3

)

Rep

lace

men

ts o

f ex

istin

g lif

e in

sura

nce

polic

y or

ann

uity

co

ntra

ct w

ith in

divi

dual

va

riab

le li

fe in

sura

nce

polic

ies,

indi

vidu

al f

ixed

do

llar

life

insu

ranc

e or

en

dow

men

t in

sura

nce

polic

ies

by a

n in

sure

r or

in

sure

r gr

oup

othe

r th

an t

he

one

whi

ch is

sued

the

origi

nal

polic

y or

con

trac

t

Prom

inen

tly p

rint

edon

or

atta

ched

to

1st

pa

ge

At

leas

t 20

day

sAn

amou

nt e

qual

to

any

of t

he fol

low

ing:

(i)

the

st

ipul

ated

pay

men

t/

prem

ium

; (i

i) t

he

differ

ence

bet

wee

n: (

A)

prem

ium

s, in

clud

ing

polic

y fe

es o

r ot

her

char

ges

and

the

amou

nts

allo

cate

d to

se

para

te a

ccou

nts;

and

(B

) th

e ca

sh v

alue

or,

if

the

polic

y do

es n

ot h

ave

a ca

sh v

alue

, th

e re

serv

e on

the

dat

e of

sur

rend

er

attr

ibut

able

to

the

amou

nts

so a

lloca

ted;

or

(iii)

the

gre

ater

of

subp

arag

raph

(i)

or

(ii)

40 P

A Con

s. S

tat.

Ann

. §5

10c

(b)(

1)In

divi

dual

var

iabl

e lif

e po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

At

leas

t 10

day

sAn

amou

nt e

qual

to a

ny

of t

he fol

low

ing:

(i)

the

st

ipul

ated

pay

men

t/

prem

ium

; (i

i) t

he

differ

ence

bet

wee

n: (

A)

prem

ium

s, in

clud

ing

polic

y fe

es o

r ot

her

char

ges

and

the

amou

nts

allo

cate

d to

se

para

te a

ccou

nts;

and

(B

) th

e ca

sh v

alue

or,

if

the

polic

y do

es n

ot h

ave

a ca

sh v

alue

, th

e re

serv

e on

the

dat

e of

sur

rend

er

attr

ibut

able

to

the

amou

nts

so a

lloca

ted;

or

(iii)

the

gre

ater

of

subp

arag

raph

(i)

or

(ii)

40 P

A Con

s. S

tat.

Ann

. §5

10d

(a)(

1)In

divi

dual

fix

ed d

olla

r an

nuiti

es o

r pu

re

endo

wm

ent

cont

ract

s,

indi

vidu

al v

aria

ble

annu

ities

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays

Stip

ulat

ed p

aym

ent

or

prem

ium

Pag

e 25

2 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

40 P

A Con

s. S

tat.

Ann

. §5

10d

(a)(

2)Rep

lace

men

t of

ann

uity

or

life

insu

ranc

e po

licy

with

indi

vidu

al f

ixed

dol

lar

annu

ities

by

the

sam

e in

sure

r or

insu

rer

grou

p

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o

1st

page

45 d

ays

Prem

ium

40 P

A Con

s. S

tat.

Ann

. §5

10d

(a)(

3)Rep

lace

men

t of

ann

uity

or

life

insu

ranc

e po

licy

with

in

divi

dual

fix

ed d

olla

r an

nuiti

es b

y in

sure

r or

in

sure

r gr

oup

othe

r th

an o

ne

issu

ing

polic

y or

con

trac

t

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o fir

st p

age

20 d

ays

Prem

ium

40 P

A Con

s. S

tat.

Ann

. §5

10d

(b)(

1)In

divi

dual

var

iabl

e an

nuiti

esPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays

Am

ount

equ

al t

o an

y of

th

e fo

llow

ing:

(i

) st

ipul

ated

pay

men

t or

pr

emiu

m;

(ii)

the

di

ffer

ence

bet

wee

n: (

A)

prem

ium

s pa

id,

incl

udin

g an

y co

ntra

ct fee

s or

ot

her

char

ges

and

amou

nts

allo

cate

d to

any

se

para

te a

ccou

nts

unde

r th

e co

ntra

ct:

and

(B)

cash

val

ue o

f co

ntra

ct

or,

if co

ntra

ct d

oes

not

have

a c

ash

valu

e, t

he

rese

rve

for

cont

ract

on

date

of su

rren

der

attr

ibut

able

to

amou

nts

so a

lloca

ted;

or

(iii)

the

gr

eate

r of

su

bpar

agra

phs

(i)

or (

ii).

40 P

A Sta

t. A

nn.

§752

(A)(

10)

Acc

iden

t an

d he

alth

in

sura

nce

Sin

gle

prem

ium

ren

ewab

le p

olic

yN

otic

e pr

omin

ently

pr

inte

d on

pol

icy

10 d

ays

Prem

ium

Pag

e 25

3 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

31 P

A Cod

e §8

9.73

Indi

vidu

al a

ccid

ent

and

heal

th c

ontr

acts

Prin

ted

on f

ace

of

polic

y or

on

book

let-

type

pol

icie

s pr

ovis

ion

shal

l ap

pear

on

outs

ide

cove

r po

rtio

n of

po

licy

10 d

ays

“Ful

l ref

und”

40 P

A Con

s. S

tat.

Ann

. §5

10d

(b)(

2)Rep

lace

men

ts o

f an

exi

stin

g an

nuity

con

trac

t or

life

in

sura

nce

polic

y w

ith

indi

vidu

al v

aria

ble

annu

ity

cont

ract

s by

the

sam

e in

sure

r or

insu

rer

grou

p

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

45 d

ays

Am

ount

equ

al t

o an

y of

th

e fo

llow

ing:

(i

) st

ipul

ated

pay

men

t or

pr

emiu

m;

(ii)

the

di

ffer

ence

bet

wee

n: (

A)

prem

ium

s pa

id,

incl

udin

g an

y co

ntra

ct fee

s or

ot

her

char

ges

and

amou

nts

allo

cate

d to

any

se

para

te a

ccou

nts

unde

r th

e co

ntra

ct:

and

(B)

cash

val

ue o

f co

ntra

ct

or,

if co

ntra

ct d

oes

not

have

a c

ash

valu

e, t

he

rese

rve

for

cont

ract

on

date

of su

rren

der

attr

ibut

able

to

amou

nts

so a

lloca

ted;

or

(iii)

the

gr

eate

r of

su

bpar

agra

phs

(i)

or (

ii).

Pag

e 25

4 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

40 P

A Con

s. S

tat.

Ann

. §5

10d

(b)(

3)Rep

lace

men

ts o

f an

exi

stin

g an

nuity

con

trac

t or

life

in

sura

nce

polic

y w

ith

indi

vidu

al v

aria

ble

annu

ity

cont

ract

s by

an

insu

rer

or

insu

rer

grou

p ot

her

than

the

on

e w

hich

issu

ed t

he o

rigi

nal

cont

ract

or

polic

y

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

20 d

ays

Am

ount

equ

al t

o an

y of

th

e fo

llow

ing:

(i

) st

ipul

ated

pay

men

t or

pr

emiu

m;

(ii)

the

di

ffer

ence

bet

wee

n: (

A)

prem

ium

s pa

id,

incl

udin

g an

y co

ntra

ct fee

s or

ot

her

char

ges

and

amou

nts

allo

cate

d to

any

se

para

te a

ccou

nts

unde

r th

e co

ntra

ct:

and

(B)

cash

val

ue o

f co

ntra

ct

or,

if co

ntra

ct d

oes

not

have

a c

ash

valu

e, t

he

rese

rve

for

cont

ract

on

date

of su

rren

der

attr

ibut

able

to

amou

nts

so a

lloca

ted;

or

(iii)

the

gr

eate

r of

su

bpar

agra

phs

(i)

or (

ii).

40 P

A Con

s. S

tat.

Ann

. §5

76In

dust

rial

life

or

indu

strial

en

dow

men

t in

sura

nce

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays

Prem

ium

31 P

A Cod

e §8

1.6

(d)

Rep

lace

men

t of

life

pol

icie

s or

ann

uitie

s th

at u

se a

gent

s or

bro

kers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

20 d

ays

Prem

ium

31 P

A Cod

e §8

2.24

(1)(

v)Var

iabl

e lif

epo

licie

sCap

tione

dpr

ovis

ion

prom

inen

tly p

rint

ed

on 1

st p

age

10 d

ays

Prem

ium

PR26

L.P

.R.A

. §1

338

Indi

vidu

al li

fe p

olic

ies

and

indi

vidu

al a

nnui

ties

Rei

nsur

ance

, gr

oup

or c

olle

ctiv

e lif

e an

d an

nuiti

esA c

laus

e re

: th

e righ

t of

the

insu

red

to

exam

ine

the

polic

y sh

all a

ppea

r on

the

co

ver

of t

he p

olic

y or

in

any

are

a th

at is

vi

sibl

e w

ithou

t op

enin

g th

e po

licy

Not

spe

cifie

d

Pag

e 25

5 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

RI

RI

Gen

. La

ws

§27-

4-6.

1In

divi

dual

life

pol

icie

s an

d in

divi

dual

ann

uitie

s de

liver

ed

afte

r Ja

nuar

y 1,

200

8

Cap

tione

d on

fac

e pa

ge o

f po

licy

or

notic

e of

pro

visi

on

stam

ped

or p

rint

ed

cons

picu

ousl

y on

fa

ce p

age

or

cont

aine

d in

at

tach

ed r

ider

20 d

ays

Prem

ium

RI

Gen

. La

ws

§27-

34.2

-6(g

)Lo

ng-t

erm

car

e po

licie

s an

d ce

rtifi

cate

sPr

omin

ently

print

ed

on 1

st p

age

or

atta

ched

to

polic

y or

ce

rtifi

cate

30 d

ays

Prem

ium

RI

AD

C 0

2 03

0 02

9,

Sec

tion

6(A)(

4)Rep

lace

men

t lif

e in

sura

nce

and

annu

ities

by

insu

rers

th

at u

se p

rodu

cers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

x A

or C

30

day

sPr

emiu

ms

or

cons

ider

atio

ns p

aid,

in

clud

ing

any

polic

y fe

es

or c

harg

es, or

, in

cas

e of

va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y, a

pa

ymen

t of

cas

h su

rren

der

valu

e pr

ovid

ed

unde

r po

licy

plus

fee

s an

d ot

her

char

ges

dedu

cted

fro

m g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

polic

y

SC

SC C

ode

Ann

. §3

8-63

-220

(b)

Indi

vidu

al li

fe p

olic

ies

Cle

ar,

unde

rsta

ndab

le,

and

cons

picu

ous

prov

isio

n on

1st

pa

ge

10 d

ays

Prem

ium

SC C

ode

Ann

. §3

8-63

-220

(b)

Indi

vidu

al li

fe p

olic

y so

licite

d by

direc

t re

spon

se in

sure

rCle

ar,

unde

rsta

ndab

le,

and

cons

picu

ous

prov

isio

n on

1st

pa

ge

31 d

ays

Prem

ium

Pag

e 25

6 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

SC C

ode

Ann

. §3

8-69

-120

(2)

Fixe

d do

llar

annu

ities

; pu

re

endo

wm

ent

cont

ract

s;

reve

rsio

nary

ann

uitie

s; a

nd

variab

le a

nnui

ties

Gro

up a

nnui

ties

Cle

ar,

unde

rsta

ndab

le,

and

cons

picu

ous

prov

isio

n on

1st

pa

ge

10 d

ays

Prem

ium

SC C

ode

Ann

. §3

8-69

-120

(2)

Fixe

d do

llar

annu

ities

; pu

re

endo

wm

ent

cont

ract

s;

reve

rsio

nary

ann

uitie

s; a

nd

variab

le a

nnui

ties

solic

ited

by d

irec

t re

spon

se

Gro

up a

nnui

ties

Cle

ar,

unde

rsta

ndab

le,

and

cons

picu

ous

prov

isio

n on

1st

pa

ge

31 d

ays

Prem

ium

SC C

ode

Ann

. §3

8-72

-60

(F)

Long

-ter

m c

are

polic

ies

and

cert

ifica

tes

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

SC C

ode

of

Reg

ulat

ions

R. 69

-12

Part

B,

art.

IV,

Sec

tion

3(a)

(5)

Var

iabl

e lif

e po

licy

Cap

tione

d pr

ovis

ion

on t

he c

over

pag

e or

pa

ges

corr

espo

ndin

g to

the

cov

er p

age

10 d

ays

To t

he e

xten

t pe

rmitt

ed

by s

tate

law

, th

e re

fund

eq

uals

tot

al p

rem

ium

s pa

id o

r th

e su

m o

f (i

) th

e di

ffer

ence

bet

wee

n pr

emiu

ms

paid

incl

udin

g po

licy

fees

or

othe

r ch

arge

s an

d th

e am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s; a

nd

(ii)

the

val

ue o

f th

e am

ount

s al

loca

ted

to

sepa

rate

acc

ount

s, o

n th

e da

te t

he r

etur

ned

polic

y is

rec

eive

d by

the

in

sure

r or

its

agen

t.

SC C

ode

of

Reg

ulat

ions

R. 69

-39

Sec

tions

2 a

nd 4

Gro

up a

nd in

divi

dual

an

nuiti

esReg

iste

red

or n

on-r

egis

tere

d va

riab

le

annu

ities

; im

med

iate

and

def

erre

d an

nuiti

es t

hat

cont

ain

no n

on-

guar

ante

ed e

lem

ents

; an

nuiti

es u

sed

to f

und

cert

ain

pens

ions

and

re

tirem

ent

fund

s; s

truc

ture

d se

ttle

men

t an

nuiti

es;

char

itabl

e an

nuiti

es;

fund

ing

agre

emen

ts

15 d

ays,

whe

n a

buye

r’s

guid

e an

d di

sclo

sure

do

cum

ent

are

not

prov

ided

at

or b

efor

e th

e tim

e of

ap

plic

atio

n

Ret

urn

cont

ract

“w

ithou

t pe

nalty

”

Pag

e 25

7 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

SC C

ode

of

Reg

ulat

ions

R.

69-3

4Sec

tion

(H)(

1)(g

)

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

polic

ies

Trip

or

trav

el t

icke

t po

licie

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1st

page

10 d

ays,

but

if

dire

ct r

espo

nse,

30

day

s

Prem

ium

SC C

ode

Ann

. §3

8-63

-220

(b)

Indi

vidu

al li

fe p

olic

ies

Cle

ar,

unde

rsta

ndab

le,

and

cons

picu

ous

prov

isio

n on

1st

pa

ge

10 d

ays;

20

days

if

repl

acem

ent

of

life

insu

ranc

e in

volv

ed;

31

days

if d

irec

t re

spon

se

Prem

ium

SC C

ode

Ann

. §3

8-69

-120

(2)

Fixe

d do

llar

annu

ities

; pu

re

endo

wm

ent

cont

ract

s;

reve

rsio

nary

ann

uitie

s; a

nd

variab

le a

nnui

ties

Gro

up a

nnui

ties

Cle

ar,

unde

rsta

ndab

le,

and

cons

picu

ous

prov

isio

n on

1st

pa

ge

10 d

ays;

20

days

if

repl

acem

ent

of

annu

ity in

volv

ed;

31 d

ays

if di

rect

re

spon

se

Prem

ium

SC C

ode

of

Reg

ulat

ions

R. 69

-12.

1

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

App

endi

x A

or C

30 d

ays

[Not

e th

at t

his

is

for

repl

acem

ent

of p

olic

ies

that

us

e pr

oduc

ers]

An

unco

nditi

onal

ful

l re

fund

of al

l pre

miu

ms

or c

onsi

dera

tions

pai

d on

it,

incl

udin

g an

y po

licy

fees

or

char

ges

or,

in t

he

case

of va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

con

trac

t, a

pa

ymen

t of

the

cas

h su

rren

der

valu

e pl

us t

he

fees

an

d ot

her

char

ges

dedu

cted

fr

om t

he g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

such

po

licy

or c

ontr

act

SD

SD

Cod

ified

Law

s §5

8-15

-8.1

Indi

vidu

al li

fe p

olic

ies

Prin

ted

on o

r at

tach

ed t

o th

e fa

ce

page

10 d

ays

Prem

ium

SD

Cod

ified

Law

s §5

8-15

-59.

1In

divi

dual

ann

uity

con

trac

ts

Var

iabl

e an

nuity

con

trac

tsPr

inte

d on

or

atta

ched

to

the

annu

it y c

ontr

act

10 d

ays

Prem

ium

Pag

e 25

8 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

SD

Cod

ified

Law

s §5

8-17

B-9

Long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

SD

Cod

ified

Law

s §5

8-28

-24.

1In

divi

dual

var

iabl

e an

nuity

co

ntra

cts

issu

ed o

n or

aft

er

July

1, 19

78

In c

ontr

act

or n

otic

e at

tach

ed t

o co

ntra

ct10

day

sTh

e re

fund

equ

als

sum

of

(i)

diff

eren

ce b

etw

een

prem

ium

s pa

idan

d am

ount

s al

loca

ted

to a

ny

sepa

rate

acc

ount

s, a

nd

(ii)

cas

h va

lue

of

cont

ract

on

date

of

surr

ende

r at

trib

utab

le t

o am

ount

s so

allo

cate

d

SD

Cod

ified

Law

s §5

8-17

-11

Indi

vidu

al h

ealth

insu

ranc

e po

licie

s or

con

trac

tsSin

gle

prem

ium

non

rene

wab

le

polic

ies

or c

ontr

acts

Prin

ted

on o

r at

tach

ed t

o po

licy

or

cont

ract

10 d

ays

Prem

ium

TNTN

Cod

e Ann

. §5

6-7-

702

(a)(

17)

Indu

strial

life

pol

icie

sCle

ar,

unde

rsta

ndab

le,

and

cons

picu

ous

prov

isio

n in

pol

icy

10 d

ays

Prem

ium

TN C

ode

Ann

. §5

6-42

-105

(f)(

1)In

divi

dual

long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

TN C

ode

Ann

. §5

6-42

-105

(f)(

2)Lo

ng-t

erm

car

e po

licie

s is

sued

pur

suan

t to

direc

t re

spon

se s

olic

itatio

n

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

TN C

ode

Ann

. §5

6-26

-129

Indi

vidu

al a

ccid

ent

and

heal

th in

sura

nce

polic

ies

or

cont

ract

s

Prin

ted

ther

eon

or

atta

ched

the

reto

” 10

day

sPr

emiu

m

Pag

e 25

9 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

TN A

dmin

. Cod

e 07

80-0

1-40

-.02

TN A

dmin

. Cod

e 07

80-0

1-40

-.04

Life

insu

ranc

e

[Not

e th

at t

he d

efin

ition

of

life

insu

ranc

e un

der

TN C

ode

Ann

. §5

6-2-

201(

4) s

tate

s th

at “

for

the

purp

oses

of th

is

title

, th

e tr

ansa

ctin

g of

life

in

sura

nce

incl

udes

the

gr

antin

g of

ann

uitie

s.”]

Ann

uitie

s, c

redi

t lif

e, g

roup

life

, lif

e in

sura

nce

issu

ed in

con

nect

ion

with

ce

rtai

n pe

nsio

n an

d w

elfa

re p

lans

; va

riab

le li

fe w

here

dea

th b

enef

its a

nd

cash

val

ues

vary

in a

ccor

danc

e w

ith

unit

valu

es o

f in

vest

men

ts h

eld

in a

se

para

te a

ccou

nt

In p

olic

y or

Pol

icy

Sum

mar

y10

day

s, w

hen

no B

uyer

's G

uide

an

d Po

licy

Sum

mar

y ar

e pr

ovid

ed p

rior

to

acce

ptin

g th

e ap

plic

ant's

initi

al

prem

ium

or

prem

ium

dep

osit

Unc

ondi

tiona

l ref

und

TN A

dmin

. Cod

e 07

80-0

1-24

-.04

TN A

dmin

. Cod

e 07

80-0

1-24

-.07

(4)

Rep

lace

men

t of

life

in

sura

nce

polic

ies

and

annu

ities

by

insu

rers

tha

t us

e ag

ents

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

in

sepa

rate

writt

en

notic

e

20 d

ays

Prem

ium

TXTX

Ins

. Cod

e Ann

. §1

651.

054

Long

-ter

m c

are

polic

ies

Prom

inen

tly p

rint

ed

on 1

st p

age

or

atta

ched

to

bene

fit

plan

doc

umen

t

30 d

ays

Prem

ium

TX I

ns. Cod

e Ann

. §1

201.

058

Indi

vidu

al a

ccid

ent

and

heal

th

insu

ranc

e po

licy

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

Prin

ted

or a

ttac

hed

to p

olic

y10

day

sPr

emiu

m

28 T

X Adm

in.

Cod

e §3

.804

(3)(

A)(

v)Var

iabl

e lif

e co

ntra

ctCap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

cov

er p

age

10 d

ays

Prem

ium

28 T

X Adm

in.

Cod

e §3

.382

9(a

)(5)

Long

-ter

m c

are

insu

ranc

ePr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 26

0 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

TX I

ns. Cod

e Ann

.

§111

6.00

2Ann

uity

con

trac

ts

Ann

uity

con

trac

t w

hose

pro

spec

tive

owne

r is

an

accr

edite

d in

vest

or20

day

sU

ncon

ditio

nal r

efun

d of

pr

emiu

m,

incl

udin

g co

ntra

ct fee

s or

cha

rges

;

For

variab

le o

r m

odifi

ed

guar

ante

ed a

nnui

ty

cont

ract

s, u

ncon

ditio

nal

refu

nd e

qual

to

the

cash

su

rren

der

valu

e pl

us a

ny

fees

or

char

ges

TX I

ns. Cod

e Ann

. §1

114.

004

TX I

ns. Cod

e Ann

. §1

114.

053

(e)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

usi

ng a

gent

s

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

com

bine

d w

ith o

ther

no

tices

req

uire

d by

Cha

pter

111

4 (R

epla

cem

ent)

30 d

ays

Prem

ium

, in

clud

ing

polic

y fe

es a

nd c

harg

es

or,

in t

he c

ase

of a

va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct,

a pa

ymen

t of

th

e ca

sh s

urre

nder

val

ue

prov

ided

und

er t

he

polic

y or

con

trac

t pl

us

the

fees

and

oth

er

char

ges

dedu

cted

fro

m

the

gros

s pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

the

polic

y or

con

trac

t.

UT

UT

Cod

e Ann

. §3

1A-2

2-42

3Li

fe in

sura

nce

and

annu

ities

po

licie

s, c

ertif

icat

esan

d co

ntra

cts

incl

udin

g re

plac

emen

ts

Empl

oyee

gro

up t

erm

life

; gr

oup

mas

ter

polic

y; n

onco

ntribu

tory

ce

rtifi

cate

; cr

edit

life

insu

ranc

ece

rtifi

cate

; an

d ot

her

clas

ses

of li

fe

insu

ranc

e po

licie

s th

at t

he

com

mis

sion

er s

peci

fies

by r

ule

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o co

ver

or fro

nt p

age

10 d

ays;

30

days

if

repl

acem

ent

polic

y or

ce

rtifi

cate

Prem

ium

UT

Cod

e Ann

. §3

1A-2

2-14

08In

divi

dual

long

-ter

m c

are

polic

ies

and

cert

ifica

tes

Empl

oyee

and

labo

r un

ion

long

-ter

m

care

insu

ranc

e ce

rtifi

cate

sPr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

UT

Cod

e Ann

. §3

1A-2

2-60

5(9

)Li

mite

d ac

cide

nt a

nd h

ealth

po

licie

s or

cer

tific

ates

issu

ed

to p

erso

ns e

ligib

le for

M

edic

are

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o fr

ont

page

of po

licy

30 d

ays

Prem

ium

Pag

e 26

1 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

UT

Cod

e Ann

. §3

1A-2

2-60

6Acc

iden

t an

d he

alth

pol

icie

sG

roup

pol

icie

s; p

olic

ies

issu

ed t

o pe

rson

s en

title

d to

a 3

0-da

y ex

amin

atio

n pe

riod

und

er U

T Cod

e Ann

. §3

1A-2

2-60

5(9

); s

ingl

e pr

emiu

m n

onre

new

able

pol

icie

s is

sued

for

ter

ms

not

long

er t

han

60

days

; p

olic

ies

cove

ring

acc

iden

ts

only

or

acci

dent

al b

odily

inju

ry o

nly;

an

d o

ther

cla

sses

of po

licie

s w

hich

th

e co

mm

issi

oner

by

rule

spe

cifie

s af

ter

a fin

ding

tha

t a

righ

t to

ret

urn

thos

e po

licie

s w

ould

be

impr

actic

able

or

unn

eces

sary

to

prot

ect

the

polic

yhol

der's

inte

rest

s

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o fr

ont

page

of po

licy

10 d

ays

Prem

ium

UT

Adm

in.

Cod

e R59

0-93

, Sec

tions

59

0-93

-2 a

nd 5

90-

93-6

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in A

ppen

dix

A o

r C

30 d

ays

Prem

ium

/con

side

ratio

n

VT

VT

Sta

t. A

nn.

tit.

8 §8

089

Indi

vidu

al lo

ng-t

erm

car

e po

licie

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d ce

rtifi

cate

s in

clud

ing

dire

ct r

espo

nse

polic

ies

dire

ct r

espo

nse

solic

itatio

n

Prom

inen

tly p

rint

ed

on 1

st p

age

30 d

ays

Prem

ium

VT

Sta

t. A

nn.

tit.

8 §4

063

(8)

Indi

vidu

al

heal

th in

sura

nce

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

insu

ring

aga

inst

acc

iden

t on

ly

or m

edic

al c

osts

or

acci

dent

al b

odily

in

jury

onl

y

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1st

page

10 d

ays,

or

30

days

for

per

sons

el

igib

le f

or

Med

icar

eby

re

ason

of ag

e

Prem

ium

, in

clud

ing

polic

y fe

es a

nd o

ther

ch

arge

s

VT

Adm

in.

Cod

e 4-

3-4:

3(B

) an

d VT

Adm

in.

Cod

e 4-

3-4:

5(A)

Indi

vidu

al li

fe in

sura

nce

Ann

uitie

s; c

redi

t lif

e; g

roup

life

; lif

e in

sura

nce

issu

ed in

con

nect

ion

with

ce

rtai

n pe

nsio

n an

d w

elfa

re p

lans

; va

riab

le li

fe w

here

dea

th b

enef

its a

nd

cash

val

ues

vary

in a

ccor

danc

e w

ith

unit

valu

es o

f in

vest

men

ts h

eld

in

sepa

rate

acc

ount

In p

olic

y or

pol

icy

sum

mar

y10

day

s, w

hen

Buy

er's

Gui

de

and

Polic

y Sum

mar

y ar

e no

t pr

ovid

ed

prio

r to

ac

cept

ing

the

appl

ican

t's in

itial

pr

emiu

m o

r pr

emiu

m d

epos

it

“Unc

ondi

tiona

l ref

und”

Pag

e 26

2 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

VT

Adm

in.

Cod

e 4-

3-13

:IV,

Sec

tion

3(A)(

5)

Var

iabl

e lif

e in

sura

nce

Cap

tione

d pr

ovis

ion

on c

over

pag

e or

pa

ges

corr

espo

ndin

g to

the

cov

er p

age

10 d

ays

Prem

ium

VT

Adm

in.

Cod

e 4-

3-43

:1(B

) an

d VT

Adm

in.

Cod

e 4-

3-43

:5(A

)(4)

Rep

lace

men

t of

life

pol

icie

s an

d an

nuiti

es b

y in

sure

rs

usin

g pr

oduc

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in

App

endi

xA

or C

30 d

ays

Prem

ium

/con

side

ratio

n in

clud

ing

polic

y fe

es o

r ch

arge

s or

, in

the

cas

e of

a v

aria

ble

or m

arke

t va

lue

adju

stm

ent

polic

y or

con

trac

t, a

pay

men

t of

the

cas

h su

rren

der

valu

e or

con

trac

t pl

us

the

fees

and

oth

er

char

ges

dedu

cted

fro

m

the

gros

s pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

such

po

licy

or c

ontr

act

VA

VA C

ode

Ann

. §3

8.2-

3300

VA C

ode

Ann

. §3

8.2-

3301

Indi

vidu

al li

fe in

sura

nce

[Not

e th

at d

efin

ition

of

life

insu

ranc

e in

VA C

ode

Ann

. §3

8.2-

102

incl

udes

in

sura

nce

that

als

o pr

ovid

es

“a s

peci

al b

enef

it or

an

annu

ity”

in t

heev

ent

of a

di

sabi

lity

and

incl

udes

ad

ditio

nal b

enef

its p

rovi

ding

sp

ecifi

ed d

isea

se c

over

age

or li

mite

d be

nefit

hea

lth

cove

rage

]

Grou

p lif

e, in

dust

rial

life

, an

nuiti

es,

cred

it lif

e, a

nd p

ure

endo

wm

ents

, w

ith o

r w

ithou

t re

turn

of pr

emiu

ms

or

of p

rem

ium

s an

d in

tere

st;

rein

sura

nce;

pol

icie

s is

sued

or

gran

ted

in e

xcha

nge

for

laps

ed o

r su

rren

dere

d po

licie

s

Prin

ted

on p

olic

y10

day

sPr

emiu

m

VA C

ode

Ann

. §3

8.2-

5208

Long

-ter

m c

are

insu

ranc

e Pr

omin

ently

print

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

VA C

ode

Ann

. §3

8.2-

3342

Indu

strial

life

Pr

inte

d on

pol

icy

10 d

ays

Prem

ium

VA C

ode

Ann

. §3

8.2-

3502

Indi

vidu

al a

ccid

ent

and

sick

ness

pol

icy

Prin

ted

on p

olic

y10

day

sPr

emiu

m

Pag

e 26

3 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

14 V

A A

dmin

. Cod

e

5-80

-300

(1)

Var

iabl

e lif

e in

sura

nce

In a

not

ice

desc

ribi

ng fre

e-lo

ok

prov

isio

ns o

f VA C

ode

Ann

. §3

8.2-

3301

10 d

ays

Prem

ium

14 V

A A

dmin

. Cod

e 5-

30-3

014

VA A

dmin

. Cod

e 5-

30-5

1(A)(

4)

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

May

be

incl

uded

in

Form

30-

A o

r 30

-C

10 d

ays

Prem

ium

s or

co

nsid

erat

ions

, in

clud

ing

polic

y fe

es o

r ch

arge

s or

, in

the

cas

e of

a va

riab

le

or m

arke

t va

lue

adju

stm

ent

cont

ract

, a

paym

ent

of t

he c

ash

surr

ende

r va

lue

plus

the

fe

es a

nd o

ther

cha

rges

de

duct

ed fro

m t

he g

ross

pr

emiu

ms

or

cons

ider

atio

ns o

r im

pose

d un

der

the

cont

ract

WA

WA S

T §4

8.23

.380

Indi

vidu

al li

fe in

sura

nce

Indi

vidu

al li

fe p

olic

ies

issu

ed in

co

nnec

tion

with

cre

dit

tran

sact

ions

or

unde

r a

cont

ract

ual c

hang

e or

co

nver

sion

privi

lege

pro

visi

on

Prin

ted

on f

ace

or

atta

ched

to

polic

y10

day

sPr

emiu

m,

but

a 10

pe

rcen

t pe

nalty

sha

ll be

ad

ded

to p

rem

ium

re

fund

not

pai

d w

ithin

30

days

of re

turn

of po

licy

to in

sure

r or

insu

ranc

epr

oduc

er

WA S

T §4

8.20

.013

Indi

vidu

al d

isab

ility

pol

icy

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

Prin

ted

on f

ace

or

atta

ched

to

polic

y10

day

sPr

emiu

m,

but

a 10

pe

rcen

t pe

nalty

sha

ll be

ad

ded

to p

rem

ium

re

fund

not

pai

d w

ithin

30

days

of re

turn

of po

licy

to in

sure

r or

insu

ranc

e pr

oduc

er

Pag

e 26

4 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

WA S

T §4

8.18

A.0

35In

divi

dual

var

iabl

e lif

e an

d an

nuity

con

trac

tsPr

inte

d on

fac

e or

at

tach

ed t

o co

ntra

ct10

day

sM

arke

t va

lue

of t

he

asse

ts p

urch

ased

by

its

prem

ium

, le

ss t

axes

and

in

vest

men

t br

oker

age

com

mis

sion

s, b

ut a

10

perc

ent

pena

lty s

hall

be

adde

d to

pre

miu

m

refu

nd n

ot p

aid

with

in 3

0 da

ys o

f re

turn

of po

licy

to in

sure

r or

insu

ranc

e pr

oduc

er

WA S

T §4

8.84

.050

(2)

Long

-ter

m c

are

insu

ranc

ePr

omin

ently

di

spla

yed

on 1

st

page

of po

licy

or

cont

ract

30 d

ays

Prem

ium

, bu

t a

10

perc

ent

pena

lty s

hall

be

adde

d to

pre

miu

m

refu

nd n

ot p

aid

with

in 3

0 da

ys o

f re

turn

of po

licy

to in

sure

r or

insu

ranc

e pr

oduc

er

WA S

T §4

8.84

.050

(2)

Long

-ter

m c

are

polic

ies

solic

ited

and

sold

by

mai

lPr

omin

ently

di

spla

yed

on 1

st

page

of po

licy

or

cont

ract

60 d

ays

Prem

ium

, bu

t a

10

perc

ent

pena

lty s

hall

be

adde

d to

pre

miu

m

refu

nd n

ot p

aid

with

in 3

0 da

ys o

f re

turn

of po

licy

to in

sure

r or

insu

ranc

e pr

oduc

er

WA A

dmin

. Cod

e §2

84-2

3-32

0

WA A

dmin

. Cod

e §2

84-2

3-35

0

Indi

vidu

al d

efer

red

annu

ities

ot

her

than

: (i

) va

riab

le

annu

ities

, (i

i) in

vest

men

t an

nuiti

es,

and

(iii)

con

trac

ts

regi

ster

ed w

ith t

he F

eder

al

Sec

uriti

es a

nd E

xcha

nge

Com

mis

sion

; an

d de

posi

t fu

nds

Empl

oyer

pai

d gr

oup

annu

ity

cont

ract

s; im

med

iate

ann

uity

co

ntra

cts;

pol

icie

s or

con

trac

ts is

sued

in

con

nect

ion

with

cer

tain

empl

oyee

be

nefit

pla

ns;

a si

ngle

adv

ance

pa

ymen

t of

spe

cific

pre

miu

ms

equa

l to

the

dis

coun

ted

valu

e of

suc

h pr

emiu

ms;

and

a p

olic

yhol

der's

depo

sit

acco

unt

in c

erta

in

circ

umst

ance

s

In a

nnui

ty c

ontr

act

or a

ssoc

iate

d lif

e in

sura

nce

polic

y

10 d

ays,

whe

n a

Con

trac

t Sum

mar

y is

not

pr

ovid

ed p

rior

to

acce

ptin

g th

e ap

plic

ant's

initi

al

cons

ider

atio

n

“Unc

ondi

tiona

l ref

und”

Pag

e 26

5 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

WA A

dmin

. Cod

e §2

84-2

3-45

5(4

)

WA A

dmin

. Cod

e §2

84-2

3-43

0

Rep

lace

men

t of

life

in

sura

nce

and

annu

ities

by

insu

rers

tha

t us

e ag

ents

or

brok

ers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

In p

olic

y or

in

sepa

rate

writt

en

notic

e de

liver

ed w

ith

polic

y

20 d

ays

Prem

ium

WV

WV C

ode

§33-

6-11

bLi

fe,

sick

ness

, an

d ac

cide

nt

insu

ranc

e po

licie

s,

cert

ifica

tes,

or

cont

ract

s

[Not

e th

at u

nder

WV C

ode

§33-

1-10

, th

e de

finiti

on o

f lif

e in

sura

nce

incl

udes

“i

nsur

ance

on

hum

an li

ves

incl

udin

g en

dow

men

t be

nefit

s,”

and

scop

e of

Art

icle

13,

“Li

fe I

nsur

ance

,”

incl

udes

ann

uitie

s.]

Gro

up a

nnui

ty p

olic

ies,

con

trac

ts,

or

cert

ifica

tes

issu

ed in

con

nect

ion

with

qu

alifi

ed o

r ex

empt

pen

sion

or

prof

it-sh

arin

g pl

an

Prom

inen

tly p

rint

ed

on 1

st p

age

10 d

ays

Prem

ium

WV C

ode

§33-

15A-6

(f)(

1)Lo

ng-t

erm

car

e po

licie

sCer

tain

em

ploy

er g

roup

s lis

ted

in

WV C

ode

§33-

15A-4

(e)(

1)Pr

omin

ently

print

ed

on o

r at

tach

ed t

o 1st

page

30 d

ays

Prem

ium

WV C

.S.R

. 11

4-11

E-2

WV C

.S.R

. 11

4-11

E-4

(4.1

.c)

Gro

up a

nd in

divi

dual

an

nuiti

esSee

exe

mpt

ions

list

ed in

W

V C

.S.R

. 11

4-11

E-2

15 d

ays,

whe

n Buy

er’s

Gui

de

and

disc

losu

re

docu

men

t ar

e no

t pr

ovid

ed a

t or

bef

ore

the

time

of

appl

icat

ion

App

lican

t m

ay r

etur

n co

ntra

ct “

with

out

pena

lty”

WV C

.S.R

. 11

4-32

-12

(12.

4)Rep

lace

men

t fo

r ac

cide

nt

and

sick

ness

pol

icie

s or

lo

ng-t

erm

car

e po

licie

s so

licite

d b y

direc

t re

spon

se

In a

writt

en n

otic

e as

sp

ecifi

ed in

W

V C

.S.R

. 11

4-32

-12

(12.

4)

30 d

ays

WV C

.S.R

. 11

4-32

-12

(12.

3)Rep

lace

men

t fo

r ac

cide

nt

and

sick

ness

pol

icie

s an

d lo

ng-t

erm

car

e po

licie

s ot

her

than

tho

se s

olic

ited

by d

irec

t re

spon

se

In a

writt

en n

otic

e as

sp

ecifi

ed in

W

V C

.S.R

. 11

4-32

-12

(12.

3)

30 d

ays

Pag

e 26

6 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

WV C

.S.R

. 11

4-12

-6(6

.8)

Indi

vidu

al a

ccid

ent

and

sick

ness

insu

ranc

eSin

gle-

prem

ium

non

rene

wab

le

polic

ies

(als

o se

e W

V C

.S.R

. 11

4-12

-1(1

.1)

for

exem

ptio

ns fro

m s

cope

of ch

apte

r)

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1

st

page

10 d

ays

Prem

ium

WV C

.S.R

. 11

4-8-

3

WV C

.S.R

. 11

4-8-

6(6

.1.d

.)

Rep

lace

men

t lif

e in

sura

nce

and

annu

ities

by

insu

rers

th

at u

se p

rodu

cers

See

ACLI

’s R

epla

cem

ent

Law

Sur

vey

for

list

of e

xem

ptio

ns.

Not

ice

may

be

incl

uded

in A

ppen

dix

A o

r C

30 d

ays

Prem

ium

s or

co

nsid

erat

ions

, in

clud

ing

any

polic

y fe

es o

r ch

arge

s or

, in

cas

e of

va

riab

le o

r m

arke

t va

lue

adju

stm

ent

polic

y or

co

ntra

ct, pa

ymen

t of

ca

sh s

urre

nder

val

ue

prov

ided

plu

s fe

es a

nd

othe

r ch

arge

s de

duct

ed

from

gro

ss p

rem

ium

s or

co

nsid

erat

ions

or

impo

sed

unde

r po

licy

or

cont

ract

WI

WI

Sta

t. A

nn.

§632

.73

Indi

vidu

al o

r fr

anch

ise

disa

bilit

ySin

gle

prem

ium

non

rene

wab

le

polic

ies

issu

ed f

or s

ix m

onth

s or

less

or

cov

erin

g ac

cide

nts

only

or

acci

dent

al b

odily

inju

ries

onl

y, a

nd

othe

r po

licie

s ex

empt

ed b

y ru

le o

f co

mm

issi

oner

, or

to

Med

icar

e su

pple

men

t po

licie

s, M

edic

are

repl

acem

ent

polic

ies

or lo

ng-t

erm

ca

re in

sura

nce

polic

ies

subj

ect

to

WI

Sta

t. A

nn. §6

32.7

3(2

m).

Con

spic

uous

ly

prin

ted

on o

r at

tach

ed t

o 1s

t pa

ge

10 d

ays

All

paym

ents

mad

e

WI

Sta

t. A

nn.

§632

.73

(2m

)Lo

ng-t

erm

car

e in

sura

nce

Sin

gle

prem

ium

non

rene

wab

le

polic

ies

issu

ed for

ter

ms

not

grea

ter

than

6 m

onth

s or

cov

erin

g ac

cide

nts

only

or

acci

dent

al b

odily

inju

ries

onl

y an

d ot

her

polic

ies

exem

pted

by

rule

of

com

mis

sion

er

Prom

inen

tly p

rint

ed

on o

r at

tach

ed t

o 1s

t pa

ge

30 d

ays

Prem

ium

Pag

e 26

7 of

App

endi

x

Sta

teC

itat

ion

Ap

pli

es t

oD

oes

Not

Ap

ply

to

Pro

visi

on L

ocat

ion

Day

sR

efu

nd

Am

ou

nt

WI

ADC I

ns. 2.

15

(3)

and

(8)(

a)Ann

uitie

s an

d de

posi

t fu

nd

arra

ngem

ents

not

mar

kete

d th

roug

h in

term

edia

ry

Var

iabl

e an

nuiti

es;

cont

ract

s re

gist

ered

with

the

SEC

; ce

rtai

n em

ploy

er g

roup

ann

uity

and

pur

e en

dow

men

t co

ntra

cts;

cer

tain

im

med

iate

ann

uity

con

trac

ts;

polic

ies

or c

ontr

acts

issu

ed in

con

nect

ion

with

ce

rtai

n em

ploy

ee b

enef

it pl

ans;

in

divi

dual

ret

irem

ent

acco

unts

and

in

divi

dual

ret

irem

ent

annu

ities

; a

sing

le a

dvan

ce p

aym

ent

of s

peci

fied

prem

ium

s eq

ual t

o th

e di

scou

nted

va

lue

of s

uch

prem

ium

s; a

po

licyh

olde

r's

depo

sit

acco

unt

esta

blis

hed

for

cert

ain

purp

oses

; an

d se

ttle

men

t op

tions

und

er li

fe

insu

ranc

e or

ann

uity

con

trac

ts

Gua

rant

ee t

o th

e co

ntra

ctho

lder

30 d

ays,

whe

n th

e in

sure

r do

es

not

use

an

inte

rmed

iary

and

pr

ovid

es t

he

Con

trac

t Sum

mar

y an

d Buy

er’s

Gui

de t

o Ann

uitie

s at

the

po

int

of c

ontr

act

deliv

ery

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Pag

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9 of

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x