July 24, 2008
To Whom It May Concern:
On June 25, 2008 the Securities Exchange Commission (SEC) published proposed rule 151A, regarding regulation of Fixed Indexed Annuities as securities, under the Securities Act of 1933, and they have requested public comments on their proposed Rule 151A.
The SEC proposal has not been appropriately vetted for comment – and appears to be being rushed to adoption. With virtually no forewarning, the SEC unveiled this proposal on June 25th and has allowed for comments only until September 10th. This means a proposal with profound effects on the insurance industry could become law within just a couple months even though agents and insurers have had minimal opportunity to evaluate, comment, and possibly offer alterative approaches to address any valid concerns. This sudden action comes ten years after the SEC first identified this very issue that was then left dormant as the FIA market grew and evolved over many years. Fair play demands that a proposal of this magnitude not be rushed, or adopted hastily.
For your information, I have been in the Financial Planning business for over 40 years, and I helped design, and develop, two of the insurance industrys top selling products, i.e. the first No-load Deferred Annuity, and Universal Life Insurance. Also, when the New York Stock Exchange Member Firms approved the sale of Life Insurance products, I was the key-note speaker at the life insurance introduction meeting to all of the New York Stock Exchange Member firms. Therefore, per their (SEC) request, I feel obligated to offer the following comment on proposed Rule 151A:
In summaryRule 151A is a huge mistake It appears to have been designed solely for the benefit of the Securities Industry, and not the consumer In fact it will be detrimental to the consumer
Sincerely:
Carl Bair, CEO, CEPS, CFP, CEPP, CIDS