October 14, 2008
Please stop proposed rule 151A as it is ill-conceived. Many securities lawyers find the SEC proposal to be confusing and completely unsupported by judicial precedents on what makes an "annuity" exempt from securities laws. Beyond that, it defies common sense that a product which has virtually no market-related downside risk should be considered a security in the same manner as mutual funds or variable products which the investor bears the risk for market losses, as we have seen happen in the past few weeks. The recent downturn in the stock market highlights the value of FIAs. While millions of Americans suffered financial losses as a result of a clitical plunge in the stock market, FIA-holders have not lost a penny in retirement savings because of the market turmoil. FIA-holders have peace of mind that market fluctuations do not adversely affect their account value. FIA products are heavily regulated by state insurance departments. Through the NAIC, state regulators have implemented appropriate suitability and disclosure requirements for FIA products. The fact is the FIA market has grown rapidly because there is a demand for these products and generally consumers have been pleased with the results.
Sincerly,
Yvonne A Hennen
HBW Insurance and Financial Services, Inc.