There continues to be a flurry of articles, emails, and webinars to discuss how the recent DOL ruling affecting Fixed Index Annuities (FIAs) sold using qualified money will impact all of our lives, livelihoods and practices. And I just can’t help but think it’s all becoming a noisy, inbox-filling waste of time. I get three emails a day projecting out the doom and gloom of the DOL rule. Everyone suggesting they can help me understand the rule. Well the rule isn’t even a rule yet!
And late last week, there was finally some new news on the matter – the filing of a lawsuit to overturn the DOL Fiduciary Rule. You may recall in a Message from the CEO in April, I closed by projecting this exact turn of events. If you haven’t heard yet, nine industry groups, led by the U.S. Chamber of Commerce filed a lawsuit in an attempt to stop the Department of Labor’s new fiduciary rule. With the Obama administration’s fast-tracking of the rule, the question becomes, can a lawsuit stop a runaway train?
For more specifics on the lawsuit I recommend this article.
Though the future of the DOL rule may be in doubt, many insurance carriers who play in the qualified plan space are already reacting by pulling product from the shelves and working on alternative product solutions. Even if the rule ultimately fails, it’s fair to assume that carriers and broker/dealers will be changing the qualified plan landscape for FIAs. At the very least, if you are registered with a broker/dealer we expect more of you to experience mandates to put these sales through their grids.
As for the future of the rule, with a major lawsuit now in play, at a minimum we are very likely looking at delayed implementation, if not complete dissolution. And if the implementation is delayed for just 6 months, a new administration with a new secretary of labor may find a way to kill or delay it further. It may not even matter who wins the election.
So maybe, just maybe, a lawsuit can stop this runaway train.
Zenith Marketing Group is tracking the DOL Rule very closely. Regardless of the outcome of the lawsuit, we are looking at options to help accommodate those of you in the FIA/qualified plan arena who will be most affected.
Stay tuned for more on this from us.