Our Legal Challenge to the Best Interest Standard
Jennifer Lindacher
Big I NY filed notice of our intent to appeal the Albany Supreme Court’s recent ruling upholding the amendment to Regulation 187, Suitability and Best Interests in Life Insurance and Annuity Transactions, arguing that the new standard improperly alters the agent/broker-customer relationship.
Independent agents and brokers believe strongly in protecting the customers who put their trust in us. However, we remain concerned that the amended regulation will not meaningfully advance this goal. Instead, it will restrict open, honest discussions with clients and weaken the market for life insurance and annuities products, ultimately harming consumers.
Our concerns about the impact of this regulation are already being borne out. Since the regulation went into effect on August 1st, multiple carriers with significant market share have announced the suspension of the sale of annuities and life insurance products in the state. We believe this concerning trend is likely to continue.
From the onset, we recognized that this legal challenge would likely be appealed to a higher court, regardless of the trial court’s decision. We remain confident in the merits of our claims, and resolute in our belief that this is a fight worth fighting.
Just a reminder that the Best Interest Rules for Annuities went into effect August 1 for annuities and will go into effect February 1, 2020 for life insurance transactions. Big I NY has created tools to guide agents and brokers on compliance, available to NY First members on our website.