Football fans in South Carolina are still talking about Coach Dabo Swinney and Clemson University’s national champion football team from 2018. Basketball fans in the Palmetto State will be talking for years about how Coach Dawn Staley and the University of South Carolina’s women’s team won the NCAA championship this spring.
But there’s another group of champions in South Carolina that also deserve to be recognized, because their achievement will benefit South Carolinians for decades to come.
The South Carolina Department of Insurance led by Acting Director Michael Wise recently enacted a rule that incorporates the enhanced consumer protections in the National Association of Insurance Commissioners (NAIC) updated model regulation on annuity transactions.
The rule enhances the standards financial professionals must follow while ensuring that individual savers maintain access to, and information about, annuities, the only financial product in the marketplace that can provide guaranteed lifetime income. This action by Wise and the Department of Insurance is an epic victory for South Carolina savers planning for retirement.
South Carolina became the 24th state to adopt similar laws or rules. Building on this momentum, several more states are considering similar actions to protect their citizens.
These moves in the states closely align with the Securities and Exchange Commission’s Regulation Best Interest. And, unlike a fiduciary-only approach, these measures ensure savers, particularly financially vulnerable lower and middle-income Americans, can access information about different choices for long-term security through retirement. According to a recent study, a fiduciary-only approach would shut down access to financial inclusion for 10 million households.
With these enhanced state and federal consumer protections, savers can rest assured that financial professionals must act in the consumer’s best interest when offering recommendations about annuities. The U.S. Congress reaffirmed the importance of lifetime income when it passed legislation in 2019 that made it easier for employers to include annuities in workplace retirement plans. These protections safeguard consumers while also ensuring that middle- and working-class families will retain access to annuities.
Leaders in the other 26 states should emulate South Carolina’s Department of Insurance and champion this sensible consumer protection. Then more Americans looking to safeguard their family’s financial future would benefit from a best interest standard of care, no matter where they reside.
Curt Leonard is Regional Vice President, State Relations at the American Council of Life Insurers. He is responsible for state legislative and regulatory affairs in Florida, Georgia, Alabama, South Carolina and North Carolina. He also leads ACLI’s state advocacy team on issues of genetic science and long term care insurance. He joined ACLI in 2003.
Johnny Craven, NAIFA-SC President, is from Walterboro, South Carolina
