How can insurance and financial professionals stay compliant while insurance regulatory changes are happening at the Federal and state level? Here’s guidance you can follow.

1. Always ensure you have satisfied the duties of insurance producers outlined in the NAIC Annuity Suitability Model, including:

  • Make reasonable efforts to obtain the customer’s suitability information prior to an annuity purchase, exchange or replacement;
  • Have reasonable grounds to determine that an annuity purchase or exchange is suitable based on facts disclosed by the customer regarding their financial situation and needs;
  • Inform the customer of the features of the product including surrender and tax penalties;
  • Ensure the customer understands applicable fees, charges, and product limitations.

2. Look to Aspida for specific disclosure materials.

Aspida is reviewing and finalizing template disclosures for use with customers. These forms are intended to assist you in meeting the PTE 84-24 exemption requirements related to sales or rollovers of qualified funds, including fixed rate annuities. They do not replace current Annuity Suitability forms.

The forms and instructions on their use and record keeping requirements are being communicated via field announcements.

Helpful Resources

These disclosures will be provided as a value-added service to our distribution partners to assist them in maintaining compliance with current and potential future requirements.

3. Be familiar with Aspida’s compliance process.

  • Aspida assumes a proactive position with a structured suitability process that adheres to the NAIC recommended guidelines as well as state requirements. The process evaluates the client’s expectations, risk tolerance and time horizon.
  • Living expenses and income requirements are evaluated and projected over the proposed annuity’s surrender charge period, with any surplus added or shortages subtracted from the client’s available net worth.
  • The proposed annuity value is added to any other annuity holdings and calculated as a percentage of the client’s available net worth.
  • Aspida works on a base line of 50% of net worth for all annuities owned and proposed. Variables such as age, risk tolerance and amount of net worth may increase or decrease the 50% baseline as determined by the suitability reviewer.

The Bottom Line

In the end, doing what’s right for your customer is the best way to protect yourself.

If you have any questions about Aspida’s compliance requirements, please contact our annuity specialists at