It's official: DOL fiduciary rule is dead

The DOL Issues Fiduciary Rule FAQ

The DOL Issues Fiduciary Rule FAQ

The DOL Issues Fiduciary Rule FAQ

The DOL Issues Fiduciary Rule FAQ

WASHINGTON, D.C. — Today the DOL issued its first set up FAQs today.

The Department of Labor published an wide-ranging FAQ, based on input received from the financial services industry and others with questions about the new, stricter fiduciary standard to be applied starting next year. The 21-page FAQ addresses general questions and more exacting questions about complex circumstances annuity agents may face.

They address questions like:

  • How will the Labor Department approach implementation of the new rule and exemptions during the period when financial institutions and advisers are coming into compliance?
  • The full Best Interest Contract Exemption provides that financial institutions cannot “use or rely upon quotas, appraisals, performance or personnel actions, bonuses, contests, special awards, differential compensation or other actions or incentives that are intended or would reasonably be expected to cause Advisers to make recommendations that are not in the Best Interest of the Retirement Investor.” Does this provision categorically preclude financial institutions from paying higher commission rates to advisers based on volume (that is, by using an escalating grid under which the percentage commission paid to the adviser increases at certain thresholds)?
  • When do firms and their advisers have to comply with the conditions of the new Best Interest Contract Exemption and Principal Transactions Exemption?

You can read them here… 

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Sentinel Security Life Annuity Rate Increase Effective 10/24/2016

Sentinel Security Life Annuity Rate Increase Effective 10/24/2016

Sentinel Security Life Annuity Rate Increase Effective 10/24/2016

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These new rates will be applied to all contracts issued on or after 10/24/2016 regardless of the date the application was received.


As we approach the last half of the 4th Quarter, 2016 is going to be another successful year for MYGA production and Sentinel would like to thank you for your continued support and the business that you place with us. It is our intent that this increase will help end the year strong for all of us!

Sentinel Security Life Annuity Rate Increase Effective 10/24/2016

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Atlantic Coast Life Annuity Rate Increase Effective 10/24/2016

Atlantic Coast Life Annuity Rate Increase Effective 10/24/2016

Atlantic Coast Life Annuity Rate Increase Effective 10/24/2016

MYGA Annuity crediting rates are increasing effective October 24, 2016! To view updated rates, please download a copy of the Annuity Rate Sheet below.

These new rates will be applied to all contracts issued on or after 10/24/16 regardless of the date the application was received. 


Administrative Office Addresses

New business applications can be sent to Atlantic Coast’s Administrative Office by postal or overnight mail using the following addresses:


Mailing Address (USPS)

Administrative Office

PO Box 27248

Salt Lake City, UT 84127-0248


Overnight / Express Address* (UPS, FedEx)

Administrative Office

1405 W 2200 S

Salt Lake City, UT 84119

 *Please note, their mail center is not open to accept overnight or express mail before 8 AM, MDT.

It's official: DOL fiduciary rule is dead

4 versions of the Best Interest Contract Exemption

4 versions of the Best Interest Contract Exemption

4 versions of the Best Interest Contract Exemption

Alternative forms of the DOL fiduciary rule’s BIC exemption that apply to advisory, brokerage and insurance firms

By Nick Thornton – LifeHealthPro – October 21, 2016

During a comprehensive presentation on the Department of Labor’s fiduciary rule, attorney Marcia Wagner called the regulation “the most significant and groundbreaking rulemaking to ever emerge” from the DOL.

The advisors and stakeholders endeavoring to adapt to the massive rule are likely in agreement with Wagner, founder of Boston-based The Wagner Law Group, a firm specializing in consulting and litigating matters under the Employee Retirement Income Security Act.

 During an hour-long webinar hosted by the Retirement Income Industry Association, Wagner interpreted the roughly 1,000-page edict in clean bullet points, accompanied by her elaboration of the rule’s impact on industry.

Her analysis of the Best Interest Contract Exemption, which DOL designed to enforce its expanded definition of fiduciary under ERISA, likely caught the attention of participating stakeholders.

That’s because, in reality, there is not one Best Interest Contract Exemption, but four, according to Wagner’s interpretation of the rule.

Wagner defined alternative forms of the exemption that apply to advisory, brokerage and insurance firms depending on the type of client being advised and existing compensation agreements.

Here are the four BIC Exemption alternatives. Wagner cautioned attendees that she coined the definitions of each, and not the DOL, but that industry is beginning to adopt her language, a feather in Wagner’s cap that she said is “pretty cool.”

1. “Full Blown” BIC: For IRAs and Non-ERISA plans 

The DOL rule allows brokers and advisors to receive variable — or commission-based — compensation, but only in compliance with the “Full Blown” BIC Exemption, which Wagner called the most extensive and complicated of the contract’s alternatives.

 The agreement, signed by both the fiduciary and the individual client receiving rollover advice, or being advised on the management of IRA assets, must reflect the “full best interest standard” established in the fiduciary rule, said Wagner.

 The advisor’s compensation must be disclosed, and fees and compensation on specific investments must be provided upon the client’s request.

 The contract must disclose all conflicts of interest and explain a firm’s compliance policies for mitigating potential conflicts.

 Fees on transactions of investments must also be disclosed. Firms will also be required to have business model and potential conflicts explained via a website.

 The Full Blown exemption also must allow for arbitration over client disputes within a “reasonable venue,” and cannot limit class action rights, according to Wagner’s presentation.

 2. “Disclosure” BIC: ERISA plans

This “slightly” easier contract, the “Disclosure” BIC exemption, does mirror much of the Full Blown BIC, but differs in that no written contract is required, according to Wagner’s presentation.

 Advisors must give a written statement of fiduciary status and give “general” disclosure on compensation and conflicts of interest.

 Specific compensation figures must be made available upon request. Like the Full Blown BIC, contracts must define a firm’s compliance policies and provide transaction disclosures on investments, and firms must provide a webpage “focusing on business model and conflicts.”

 3. “Streamlined” BIC: Level-fee fiduciary

Existing RIA fiduciaries compensated on fees are not off the hook when it comes to the BIC exemption.

They will need to issue a “streamlined” contract when offering IRA rollover advice to plan participants of an existing sponsor client, when that advice results in higher fees. Thus, the “Streamlined” BIC exemption.


It will also affect level-fee fiduciaries when they give rollover advice to “off the street” clients — those they do not have a previous relationship to via a plan sponsor client.

 Also, when level-fee fiduciaries move a client from a commission to a fee-based account, they will have to operate under a Streamlined BIC exemption.

 That contract is less onerous, explained Wagner. It must include written statements declaring the fiduciary status of the advisor, and it requires the advisory firm to internally document the reason why the rollover recommendation is in the client’s best interest.

 The Streamlined BIC does not require disclosure of compliance policies.

 4. “Transition” BIC: For all IRA and plan clients

This optional alternative to the Full Blown BIC, the “Transition BIC,” may be of use to firms that are not ready to fully comply with the rule come April 10, 2017, the deadline for the first round of compliance.

 The most onerous of the rule’s requirements will not go into effect until Jan. 1, 2018. The Transition BIC exemption gives those firms not fully ready to operate under the Full Blown, Disclosure, or Streamlined BIC by April 10 the chance to buy a bit more time.

 With this alternative, advisors will have to provide a written statement acknowledging their fiduciary status, as well as conflict disclosures, which can be provided via email.

 The name of the compliance officer who is monitoring complete implementation of the contract in the interim period will also have to be disclosed.

 Wagner said there will be no need for compliance policies or other disclosures when issuing the Transition contract.

It's official: DOL fiduciary rule is dead

The $65 Million Question: What License is Needed to Sell under DOL Rule?


The $65 Million Question: What License is Needed to Sell under DOL Rule?

By Kim O’Brien – InsuranceNewsNet – October 5, 2016

Since Americans for Annuity Protection launched its AskAAP program in August (available as a free benefit to AAP members), we’ve received hundreds of questions about the DOL Rule, its impact on annuity advisors and what it means to act as a fiduciary under the rule.

This week we highlight the most frequently asked question: Do I need a Series 65 to sell a qualified annuity IRA?

The short answer is NO. We will explain why in a bit, but first let’s understand what licenses are available to annuity advisors and what they authorize the licensee to do. We’ve compiled information from the FINRA, SEC and

Investopedia websites. There are three categories of regulators who oversee the licensing:  State Insurance Departments, FINRA and the NASAA.

Of course, all annuity advisors must hold an insurance license from the state in which they sell annuities. It is usual for the licensing state to be determined based on the address of the annuity buyer. So, if the annuity buyer lives in Arizona you must hold a valid life insurance license issued by the state of Arizona.

As an advisor and/or agency holding a valid state insurance license, you are authorized to sell fixed annuities only; including fixed indexed annuities.

FINRA – Financial Services Regulatory Authority Licensing Breakdown

FINRA offers several different types of licenses needed by both representatives and supervisors. Each license corresponds to a specific type of business or investment. While there are several licenses which focus on specific types of securities, there are three general licenses that the majority of representatives and advisors usually obtain:

Series 6: The Series 6 license is known as the limited-investment securities license. It allows its holders to sell “packaged” investment products such as mutual funds, variable annuities and unit investment trusts (UITs). Principals who supervise representatives holding a Series 6 license must obtain the Series 26 license in addition to having already obtained the Series 6.

Series 7: The Series 7 license is known as the general securities representative (GS) license. It authorizes licensees to sell virtually any type of individual security. This includes common and preferred stocks; call and put options; bonds and other individual fixed income investments; as well as all forms of packaged products (except for those that also require a life insurance license to sell).

The only major types of securities or investments that Series 7 licensees are not authorized to sell are commodities futures, real estate and life insurance.

Those who carry this license are officially listed as “registered representatives” by FINRA, but they are generally referred to as stockbrokers. Many insurance agents and other types of financial planners and advisors also carry the Series 7 license to facilitate certain types of transactions inherent in their businesses. Principals of general representatives holding a Series 7 must also obtain the Series 24 license.

Series 3: The Series 3 license authorizes representatives to sell commodity futures contracts, which are generally considered the riskiest publicly traded investments available.

Representatives that carry the Series 3 license tend to specialize in commodities and often do little or no other business of any type.

NASAA – North American Securities Administrators Association Licensing Breakdown

Not all securities licenses are administered by FINRA. The North American Securities Administrators Association (NASAA) oversees the licensing requirements of three key licenses:

Series 63: The Series 63 license, known as the Uniform Securities Agent license, is required by each state and authorizes licensees to transact business within the state. All Series 6 and Series 7 licensees must carry this license as well.

 Series 65: The Series 65 license is required by anyone intending to provide any kind of financial advice or service on a non-commission basis. Financial planners and advisors that provide investment advice for an hourly fee or a flat fee percentage of assets fall into this category, as do stockbrokers or other registered representatives that deal with managed-money accounts.

 Series 66: This Series 66 is the newest exam offered by NASAA. It combines the Series 63 and 65 exams into one 150-minute exam.

Broker-Dealer Sponsorship versus RIA Requirements

Licensees must register their securities licenses with an approved broker-dealer. Those who intend to hold themselves out to the public as Registered Investment Advisors (RIAs) must register with the state they do business in if their assets under management are less than $25 million, or with the SEC if the assets exceed $25 million. RIAs do not need to associate themselves with a broker-dealer.

So what license MUST YOU HAVE to sell compliantly under the DOL’s Fiduciary Rule? That depends on the products and services you offer.

If you offer ongoing financial planning and charge a flat fee for your planning services, you will need a 65. If you want to sell variable annuities or mutual funds, you will need a Series 6 and 63.

If you simply want to offer fixed annuities and life insurance products for guaranteed income or asset protection needs, you will only need a life insurance license in the states you intend to do business.

However, if you want to give specific, individualized and tailored advice regarding the securities, mutual funds or variable annuities your client owns, you will need the appropriate additional license to do that.

On the other hand, if you limit your advice to general information about diversification, various investment markets, market risk and recent or historic economic activities, your state insurance license authorizes you to have those general conversations and you do not need additional FINRA or NASAA licenses to do so.

Of course, the insurance-only advisor must and should discuss client’s objectives, needs, risk tolerance, liquidity and time horizon as required by suitability and, if applicable, fiduciary compliance.

You may ask why is AAP so sure that you DON’T need a Series 65 to continue selling annuities in a DOL fiduciary world? Because the DOL states just that in the rule:

 The Department published proposed new and amended exemptions from ERISA’s and the Code’s prohibited transaction rules designed to allow certain broker-dealers, insurance agents and others that act as investment advice fiduciaries to nevertheless continue to receive common forms of compensation that would otherwise be prohibited, subject to appropriate safeguards.

While a recommendation to move (or not move) qualified money to an annuity triggers the fiduciary duty, that does not mean you must now be Series 65 licensed. Don’t be lured by misleading marketing or opportunistic recruiters.

Get the license(s) you need to help the clients you choose with the products and services you offer.

Yes, as an insurance-only agent you may be leaving assets on the table because of insurance company suitability guidelines or licensing restrictions. And, yes, if you want to provide ongoing financial planning services, you will need to be licensed to do so.

But, if you choose to be an insurance specialist assessing your client’s insurance needs and you want to provide knowledgeable and competent analysis on what insurance solutions will best fulfill those needs, be an insurance-only advisor. Your services and skills are sorely needed in our overblown world of market risk and investment product idolatry. ________________________________________

Kim O’Brien is the vice chairman and CEO of Americans for Annuity Protection. She has 35 years of experience in the insurance industry. O’Brien served The National Association for Fixed Annuities (NAFA) for almost 12 years and led the organization to defeat he SEC’s Rule 151A.

FGL FIAs Now Available in MN, OR, PA and WA

FGL FIAs Now Available in MN, OR, PA and WA

  FGL FIAs Now Available in MN, OR, PA and WA

  FGL FIAs Now Available in MN, OR, PA and WA

FGL’s Performance Pro and Safe Income Plus Fixed Indexed Annuities Are Now Available in MN, OR, PA and WA

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For Producer Use Only – Not For Use With the General Public

Product form numbers: API-1018 (06-11), ACI-1018 (06-11), ARI-1054 (02-13), ARI-1065 (11-13); et al. 

*GMWB rider available at an additional cost. Performance Pro 0.95%, Safe Income Plus 1.05% deducted from the account value of each contract anniversary.

“FGL” when used herein refers to Fidelity & Guaranty Life, the marketing name for Fidelity & Guaranty Life Insurance Company issuing insurance in the United States outside of New York. Annuity contracts issued by Fidelity & Guaranty Life Insurance Company, Des Moines, IA.