What comes to mind when you think about Nevada?
Gaming in Las Vegas? Skiing near Lake Tahoe? Professional sports champions like the Las Vegas Aces and Golden Knights? UFO hunting around Area 51?
How about benefiting from the latest consumer protection?
Nevada recently adopted a rule promoted by Insurance Commissioner Scott Kipper that incorporates the enhanced consumer protections in the National Association of Insurance Commissioners (NAIC) updated model regulation on annuity transactions. Nevada became the 48th state to adopt such measures.
The new rule enhances the standards financial professionals must follow and protects consumers’ access to, and information about, annuities, the only financial product in the marketplace that can provide guaranteed income for life. This important consumer protection rule is a jackpot for Nevada’s 3.2 million residents, who are now in a stronger position to achieve financial security and prosperity throughout retirement.
All told, more than 95% of U.S. citizens now live in a state that has adopted a best interest standard. Building on this momentum, the remaining states are considering related measures to further protect their citizens.
The actions in the states closely align with the Securities and Exchange Commission’s Regulation Best Interest. And, unlike the Department of Labor’s ill-advised fiduciary-only regulation, these harmonized measures ensure savers, particularly financially vulnerable middle-income Americans, can access annuities and information about other options for their retirement savings.
The DOL’s regulation is similar to its failed 2016 regulation that, before it was struck down by a federal court, resulted in more than 10 million American workers’ accounts, with $900 billion in savings, losing access to professional financial guidance. A recent survey shows that retirement savers overwhelmingly want the freedom to work with any kind of financial professional who is offering products and services that meet their needs.
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 and 2022 to make it easier for employers to include annuities in workplace retirement plans and simpler for savers and retirees to utilize annuities.
More than 4.1 million Americans are turning 65 each year through 2027. Now is definitely not the time to limit people’s options for retirement.
We look forward to the remaining states that lack this best interest consumer protection joining Nevada and the rest of the country before long. The best interest standard is a big win for all Americans who are working to secure their financial future.
John Mangan is Vice President & Deputy, State Relations at the American Council of Life Insurers (ACLI). He is responsible for state legislative and regulatory affairs in California, Idaho, Nevada, Oregon and Washington. He also leads the ACLI’s state advocacy team on the issues of state-run retirement plans and independent contractor proposals.
NAIFA-Nevada Political Action Committee Chair Jarod Morgan is from Henderson, Nev.
