​​​​​Last month the U.S. Department of Labor released a new fiduciary regulation that tightens conflict of interest rules under the Employee Retirement Income Security Act (ERISA).

Much like the draft version released last year, the final rule is dense, complicated, and confusing. While arguably well intentioned, the rule will likely make retirement advice more costly and complicated—particularly for middle and low income consumers with small balance retirement accounts.  

The rule is far reaching and will have a large impact on the insurance market, including certain retirement advice offered by insurance agents and brokers related to annuities and health savings accounts (HSAs), among other products. Generally, the rule will likely impact insurance products that have some type of retirement or investment component under the ERISA and the tax code. The rule may also impact retirement plans offered by member agencies to their employees. 

How some parts of the rule will apply “in practice” and the full impacts of the rule on agents and brokers are not yet clear, due to the complexity of the rule as well as some ambiguities in the rule. However, Big “I” staff has prepared a preliminary Q&A document to provide general background information on some of the threshold questions surrounding the rule.
  

View/download Fiduciary Rule Q&A​

There is already a Congressional effort to stop the implementation of the new regulations. 

The Big “I” is concerned that the expansion of fiduciary standard from only investment advisors to include broker-dealers would harm investors and limit consumer access to professional advice. 

The Big “I” is also concerned with new DOL overtime requirements for “white collar” workers under the Fair Labor Standards Act that would be overly burdensome for small businesses.

This effort has passed the House and is awaiting Senate action.