November 17, 2008
To whom it may concern:
My name is Dennis R. Streich and am writing in opposition to Proposed Rule 151A. I've been an insurance agent since 1981 and am a member of NAIFA and NAFA and have been selling annuities since that time. I have many customers who have deposited money into annuities in order to protect their hard earned money from stock market fluctuations. None of my customers have lost money deposited in the annuities and my customers today are very thankful not to have lost money in the recent downturn in the stock market.
Other than one sided reports by magazines and television I have not seen any evidence that supports the Commission's claim that widespread abuses in selling the product exist. Even though the Commission cites its concern over improper sales practices as the primary basis for proposing Rule 151A, I have seen no study or research findings or any statistics demonstrating or suggesting that abuses are endemic or pervasive. 41 states have adopted the NAIC Suitability Model and the NAIC reports that .1% of all complaints filed with state insurance departments are related to fixed indexed annuities. Members of the ACLI, NAIFA, NAILBA and IMSA, and insurance regulators deplore fraudulent, misleading or abusive sales practices.
The Commission's action would restrict public access to a a product that is becoming more and more popular to the public. Many independent insurance agents including myself have indicated to me they will cease making annuities available to their clients if annuities become registered as securities - particularly because many such independent insurance agents do not desire to become registered representatives associated with broker-dealers due to the cost and administrative burden relative to requirements that are inapplicable to the business of insurance. The results of agents deciding not to offer this valuable product would naturally limit public access to the product. Such a result is harmful to the public because it restricts the availability of a product which provides the opportunity for greater potential interest while also providing principal and minimum interest guarantees.
Part of the appeal of indexed annuities to the public is that it is NOT securities not subject to risk of loss from market activity. None of the clients I have who have purchased indexed annuities have lost a dime. I can't say that about any of the clients I sold mutual funds to when I was a registered representative.
Fixed indexed annuities are currently subject to comprehensive state insurance regulation. As an insurance agent I put the needs of my clients first and foremost. Not one of my clients has ever registered a complaint to me or about me to the OIC. That's because, like the majority of agents out there I take my responsibility as an insurance agent very seriously. My goal is to provide protection to my clients whether it is with a life insurance policy, disability policy or a fixed indexed annuity. Making fixed indexed annuities a registered product will severely limit availability of a guaranteed insurance product that helps me provide my clients with economic security, especially during times of significant economic turmoil such as what we see today.
Thank you for considering my statement.
Dennis R. Streich
With regard to Proposed Rule 151A