Do you know which state has the highest average life expectancy in the nation?
It’s Hawaii, where residents have a life expectancy at birth of 81 years.
More than 1.4 million people reside in the Aloha State. And thanks to a new law, Hawaii residents will be in a better position to achieve financial security and prosperity for their entire lives.
Governor David Ige recently signed a law that incorporates the enhanced consumer protections in the National Association of Insurance Commissioners (NAIC) updated model regulation on annuity transactions.
The law 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 income for life. This is an epic victory for Hawaiian savers.
Hawaii became the 27th state to adopt similar laws or rules. Building on this momentum, several more states are considering similar measures to protect their residents.
The actions 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 be 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 easy-to-understand financial information.
More states should follow Hawaii and adopt this sensible consumer protection. Then more Americans looking to protect their family’s financial future would benefit from a best interest standard of care, no matter where they reside or how long they live.
Joann Waiters is a Regional Vice President in the State Relations Department at the American Council of Life Insurers (ACLI). She has worked at ACLI for over 20 years and is currently responsible for managing the legislative and regulatory affairs for Arizona, Arkansas, District of Columbia, Hawaii, and Montana.
Cynthia Takenaka, NAIFA-HI Govermnent Relations Chair, is from Honolulu, Hawaii.
