What is SEC's Proposed Rule 151A?

SEC 151A is a proposed SEC regulation that, if adopted, will make Fixed Indexed Annuities a registered security. You can read the full text of the proposed rule here. If you currently sell fixed annuities without a securities license, this rule will directly impact your practice.

There are many conflicting voices ringing in on both sides of the issue. When you cut through the noise, the underlying principles are:

• A Fixed Annuity, like other savings vehicles, does not carry the negative investment risk present in securities products.
• The legal precedent set by several key rulings is that a Fixed Annuity is NOT a registered security.
• Consumers are better off dealing with their State Department of Insurance than with the legal proceedings necessary to file a complaint through the SEC.
• SEC151A, as proposed, will provide a competitive advantage to large brokerage houses, while having a significant negative impact to the business of agencies and producers.

If you currently sell or are considering selling annuity products in the future, I urge you to post your own comment to the SEC. The examples below provide templates and suggested talking points.

*updated 9/5/2008

• NAILBA Comments on SEC Proposed Rule 151A
• Click here for a letter from the National Governors Association to SEC Chairman Christopher Cox expressing concern over the SEC's proposal and asking them to extend for a reasonable period the 60-day comment period.
• Click here for a letter from Senator Tom Harkin to Chairman Cox asking that the SEC grant at least a 90-day extension of the comment period so that the appropriate entities could provide their full thoughts to the Commission.

*updated 8/26/2008

In our efforts to keep you informed of significant developments regarding SEC Proposed Rule 151A, we want to share with you a letter addressed to SEC Chairman Christopher Cox from several Members of Congress.
This letter expresses concern over the SEC's proposal and requests that the SEC provide an additional 90 days for the industry and the public to review and comment on it.
Below is a link to the letter addressed to the SEC Chairman:

• Rule 151A Congressional Extension Request to Chairman Cox

Our carriers respond

• Old Mutual's Alert To Producers
• American Equity Investment Life Insurance *updated 8/19/2008
• Aviva Life's responds to Proposed Rule 151A
• ING USA's response to Proposed Rule 151A

Who to contact

• Find your House Representative
• Find your Senate Representative

More on proposed rule change 151A

• Text of the SEC's proposed rule change on www.sec.gov.
• Sample form letter to a congressional representative