September 2, 2008
Regarding proposed rule 151-A, I am asking you to extend the comment period so that individuals like myself may take the time to write our representatives, senators, etc.
I would like to say that an indexed annuity provides a GUARANTEE AGAINST INVESTMENT RISK. The DJIA has suffered a decline this year of around 20% so far, and yet a fixed indexed annuity purchaser WILL NOT lose principal, or previously earned interest.
A consumer that purchases an equity security, a stock mutual fund, or a variable annuity is and will be subject to market loss, that is not the case with an indexed annuity.
The annuity interest crediting formula protects the owner against loss due to drops in the index over the crediting period and while the guarantees provided come at a price, that price is fully disclosed to the consumer.
These products are already regulated by individual states and the dual registration would be a nightmare and would have the consumer suffering due to lack of availability. Isn't that who we are trying to protect in the first place?
There are always going to be unscrupulous agents, just like registered representatives, who use inappropriate sales tactics. Additional regulation will not stop those people.
We are asking you to reconsider the unnecessity of the additional regulation as states already have strong insurance suitability requirements.