Subject: File No. S7-14-08
From: Paul A Silva
Affiliation: Education Chair, Capital District Assoc. of Ins. and Financial Advisors

October 22, 2008

-With all due respect, it is important to keep sight of the obvious. Index annuities are fixed products. They may have have some attributes in common with the Securities that the SEC has jurisdiction over, but that does not make them securities. Having a guaranteed value even when the market goes down should keep them out of the jurisdiction of the SEC.
There are already sufficient avenues of oversight and regulation in the insurance environment. If there are still sales abuses, the answer is to police more strongly the activities of those already licensed to sell the product by those already charged with that responsibility.
An analogy comes to mind. Let's say the AFT (Alcohol,Firearms and Tobacco) regulators took offense to how many people were dying from medication errors. How quickly would they be howled down if they tried to do the job of the FDA?
It is a question of like kind. An indexed annuity is not a security any more than a prescription is a firearm.
My last question is this. If a regulatory body oversteps it's clear mandate, are there torts we can expect?