In a move to improve consumer
protection, the New York State Insurance Department has issued what
it terms two new “emergency regulations” relating to the sale of
life insurance and annuities.
The two regulations
are:
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- only a suitable annuity,
based on a consumer’s financial situation and needs, can be
recommended by an insurer, agent or broker; and - insurance agents and brokers
are prohibited from using titles, such as certified senior advisor,
that suggest they have special expertise on issues regarding
seniors when, in fact, they have no such
qualifications.
New York Insurance
superintendent James Wrynn commented that his department has seen a
number of cases where consumers have been convinced to buy or
replace existing annuities with new annuities that are not in their
best interests.
“While the vast majority of
agents and brokers are honest and trustworthy, there are those few,
motivated by the commissions they’ll receive, who sell annuities
that put consumers’ assets needlessly at risk or use fictitious
titles to mislead seniors into thinking they are qualified to
help,” Wrynn said.
According to the insurance
department, life insurance companies wrote $17bn in annuity
premiums in the state in 2009.
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