Subject: File No. S7-14-08
From: Stanley H Shawl, CLU,ChFC

September 9, 2008

State regulation under the NAIC rules is quite adequate.

No significant benefit goes to indexed annuity holders through additional regulation.

There will always be "bad apples" in the barrel. There are existing methods and procedures for weeding them out. Additional federal regulation will not change this.

An indexed annuity still places the investment risk on the shoulders of the insurance company and not the annuity holder. A variable annuity is quite different in that the annuity holder DOES take on the investment risk. The latter has and should have federal regulation. The indexed product does not need this added burden.

The insurance industry is over 150 years old. It has quite adequate means of policing itself as well as through NAIC sponsored state regulation.