Getting It Right

There’s cause for celebration in Maine, thanks to a new rule that ensures that financial professionals must act in the best interest of savers in the Pine Tree State.

The Maine Bureau of Insurance recently adopted a rule that enhances the standards financial professionals must follow while ensuring that individual savers maintain access to, and information about, annuities.

This is a big victory for consumer protection and for all Maine citizens planning for retirement.

The rule enacts the National Association of Insurance Commissioners’ (NAIC) updated model regulation on annuity transactions.

Maine is now the 15th state with a new law or rule that incorporates the NAIC model’s additional protections. Several other states are considering similar actions to protect their residents.

These state actions also closely align with the Securities and Exchange Commission’s Regulation Best Interest, which took effect last year. 

With these enhanced consumer protections, people know that financial professionals must act in the consumer’s best interest when offering recommendations about annuities. These standards protect consumers while also ensuring that middle- and working-class families will continue to have access to practical and easy-to-understand financial information.   

Ready access to financial information is especially important these days. Because of the economic turmoil spawned by the COVID-19 pandemic, many Americans have heightened concerns about their retirement security. Their worries can be lessened through financial security tools, including annuities, the only financial product in the marketplace that allows savers to create a personal pension with income they can’t outlive.

American consumers obtain valuable information and education about annuities from financial professionals. All consumers need to have access to the peace of mind that comes from guaranteed income for life. And they deserve to be assured that financial professionals must act in the consumer’s best interest when recommending annuity products.

Maine’s adoption of the NAIC model provides that assurance to Pine Tree State consumers. 

More states should follow the lead of Maine with this consumer protection. That way more consumers will benefit from a best interest standard of care, regardless of where they live.

(NAIFA-ME’s President Terri Wright, CLU, is a 14-year State Farm Agent. She is a lifelong Maine resident and has her Bachelor’s degree from the University of Southern Maine.)

Michelle Carroll Foster

Michelle Carroll Foster is Regional Vice President, State Relations at the American Council of Life Insurers (ACLI). She is responsible for state legislative and regulatory affairs in Maine, Maryland, Pennsylvania, Puerto Rico, and Virginia. She also leads ACLI’s state advocacy team on annuity, best interest, and fiduciary matters. She joined ACLI in 2019.