November 17, 2008

Subject: File Number S7-14-08

My name is Caroline M. Peek, resident of Charlotte, NC . registered investment advisor, a Certified Retirement Financial Advisor, licensed Life, Accident, Health. licensed Med Supplement & Long-Term Care working in the financial industry for approx 16+ years and I am opposed to the proposed 151A rule, File #S7-14-08.

This proposal is not supported by any empirical evidence that supports the Commission's claim that widespread abuses in selling the product exist. 41 States have adopted the NAIC Suitability Model and the NAIC reports that .1% of all complaints filed with state insurance departments relate to fixed index annuities.

I hear of many complaints about variable annuities, a securities registered product and of 'sales abusive' with this registered securities product, variable annuities which continue to be misrepresented to many seniors.

Unfortunately, when seniors and main street folks hear the term annuity most believe this means 'safety of principal', minimum interest guarantees not realizing the oxymoron association of 'variable annuity'. The focus with the securities' commission should clearer understanding, clearer definitions of expenses and potential losses associated with a variable annuity.

The Commission's action would restrict public access to an increasingly popular 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 & minimum interest guarantees -- which are qualities of a fixed deferred annuity, non-registered securities products. This defies securities products offering no minimum interest and no safety of principal.

Fixed indexed annuities are currently subject to comprehensive state insurance regulation. As with either the variable or fixed indexed annuity it is essential as well as explicitly outlined in the fixed indexed annuities' disclosure statements that must be signed regarding the 'surrender penalty period and imputed penalty imposed each year during that penalty period. Many carriers have emphasized this surrender penalty periods & penalties by asking applicants to initial this area of the disclosure. The proper steps would be to ensure proper education, consultations on these products versus simply imposing securities' regulations. For sake of redundancy - Variable Annuities are securities regulated yet are grossly misunderstood by the vast number of annuitants purchasing these products.

There are no characteristics and/or attributes of a fixed indexed annuity justifying converting these products to a securities regulated product. Therefore this ruling should NOT BE PASSED. The appeal of indexed annuities is that they are not securities and are not subject to risk of loss from market activity.

Caroline M. Peek, BS, IAR, CRFA, CLTC
Charlotte, North Carolina