Subject: File No. S7-14-08
From: Tipton W Huffman
Affiliation: CLU / ChFC, President TWH Annuities Insurance Agency, Inc.

August 6, 2008

I am writing to prostest the passage of proposed rule 151a for the following reassons:

#1 This rule will not serve in the best public interest. If approved many insurance agents, clerical staffs, and insurance company staffs and executives will lose their primary source of revenue and their jobs. Many annuity policyholders will no longer be serviced by the agents that helped them to make their purchase and the registered reps that would replace them would have little knowledge or support for the product sold. This will result in predatory actions taken by securities licensed representatives leading to masssive fixed indexed policy replacements. These replacements will, in all likelihood, be sanctioned by Registered Representatives supervised by Broker Dealers. The necessary paperwork will be filled out justifying these replacements as "suitable" and the original writing agent will have no monetary reason to defend or service the product that was sold. This is a losing situation for the buyer.

#2 Fixed Indexed annuities are not securities. They have minimum lifetime interest guarantees and no market exposure. Surrender penalty periods vary from as little as 3 years to as long as 14 with the vast majority of product sales averaging under 8 years. During the surrender penalty period manny liquidity options are built in. The vast majority of fixed indexed annuities allow for a 10% free withdrawal of account value each year. The vast majority also allow for liquidation without penalty after the fifth policy year over a five year payout period or longer. These payout options are often one of the reasons
that people choose to make their purchase.

#3 Articles written have stated that income options are available only on the contract "commencement date" which is usually after 10 years or age 85. They incorrectly state that as a result an 85 year old would not be able to access funds until age 95. The reality is that contractually the buyer must make a decision on this date, usually to extend the contract, take income, or surrender
the contract for cash. Most every annuity contract allows 10% free withdrawals as staged above or income to become after the fifth contract year free of any penalties. Older buyers buy because of the guarantees and the fact that with most contracts 100% of the contract value is paid, in the event of death, probate free to beneficiaries.

#4 It has been stated that seniors have been sold fixed indexed products that are unsuitable and have complained to state insurance departments in large numbers. The facts based on complaints filed do not support this.
According to National Association of Insurance Commissioner statistics of the total of 2,241 complaints filed by all annuity policy holders in 2007 only 248 were about fixed indexed annuities. This is on over $24 billion of total sales and what must amount to hundreds of billions of in force premium on thousands of policyholders. This is consistent with the 2006 complaint and premium level as well. Any product line sold will have a certain percentage of unhappy buyers. Based on the above statistics it would appear that fixed indexed annuity buyers are overwhelmingly satisfied with their purchases.

This rush to "Supervise" will have a far reaching negative impact on the insurance industry and those employed by it, on the current policyholders that have purchased these products, and will cause a vast reduction in the sale of this product line to those that need it most. In a time when banks are being scrutinized savers are looking for safe havens. The life insurance industry and the fixed and fixed indexed products that they offer fills the need. SEC supervision is unwarranted and will not be in the best public interest.