Institute Call For Expedient Public Policy Action
WASHINGTON, D.C. –
The Insured Retirement Institute (IRI) today submitted its response to the Federal Insurance Office (FIO) request for comment for “Public Input on the Report to Congress on How to Modernize and Improve the System of Insurance Regulation in the United States.” In the letter, the IRI commends the FIO’s efforts to identify ways to modernize and improve the country’s insurance regulatory system, while examining the availability of insurance products to underserved populations. The Institute also encourages the FIO to focus on the regulatory environment in the context of the current state of retirement savings readiness in America and the need for consumers to insure against the risk of outliving their assets as part of any assessment of the regulation of the insured retirement industry.
“Seventy-nine million Baby Boomers today face immediate and unprecedented retirement income challenges — challenges that simply did not exist in earlier generations,” stated IRI President and CEO Cathy Weatherford in the response letter. “In particular, when looking at the financial preparedness of middle-income consumers nearing retirement, IRI’s research shows a concerning lack of savings. Nearly one-third of Baby Boomers cite having adequate retirement assets as a top concern, while over half said they will work for income in retirement, meaning they actually will not be retired. This reality underscores the critical importance of educating consumers about the need to create a prudent, well-thought-out retirement income plan, as well as the importance of a
regulatory environment that encourages consumers to meet these needs and creates the best environment in which the industry can provide products and services in the most efficient and cost effective manner possible.”
In IRI’s response letter, the Institute recommends that the FIO include the following items in its report on how the system of insurance regulation can be modernized and improved:
- Federal and state regulators should provide consumers more education regarding the risk of outliving their assets and the financial strategies that can provide guaranteed lifetime income.
- Congress should pass the Lifetime Income Disclosure Act to assure workers receive adequate information about their retirement lifetime income needs.
- The Securities & Exchange Commission (SEC) should adopt a variable annuity summary prospectus and other summary disclosures providing more user friendly consumer information and encouraging greater use of guaranteed lifetime income products.
- All states should adopt the Interstate Insurance Product Regulation Compact, or product standards and approval deadlines consistent with the Compact, and the Compact should complete products standards for all products.
- FIO should recommend Congressional adoption of NARAB II legislation and continued state pursuit of full reciprocity and uniformity in the agent licensing process.
- Producer examination standards should be uniform and transparent.
- Market conduct examinations should be conducted in a coordinated and efficient manner on a consolidated basis.
- Any resolution authority should maintain the current prioritization of policyholder claims and the current status of separate account assets that apply to annuity products.
The full text of the letter can be accessed here
About the Insured Retirement Institute:
The Insured Retirement Institute (IRI) is a not-for-profit organization that for twenty years has been a mainstay of service, commitment and collaboration within the insured retirement industry. Today, IRI is considered to be the authoritative source of all things pertaining to annuities, insured retirement strategies and retirement planning. IRI proudly leads a national consumer education coalition of nearly twenty organizations and is the only association that represents the entire supply chain of insured retirement strategies: our members are the major insurers, asset managers, broker dealers and more than 75,000 financial professionals. IRI exists to vigorously promote consumer confidence in the value and viability of insured retirement strategies, bringing together the interests of the industry, financial advisors and consumers under one umbrella. IRI’s mission is to: encourage industry adherence to highest ethical principles; promote better understanding of the insured retirement value proposition; develop and promote best practice standards to improve value delivery; and to advocate before public policy makers on critical issues affecting insured retirement strategies and the consumers that rely on their guarantees. Visit www.IRIonline.org today to experience the vast resources of the Insured Retirement Institute for yourself.