What are the latest views, opinions and outlooks on the end of the DOL Fiduciary Rule?

Jun 13, 2018

  1. LarkspurRixtrema

    LarkspurRixtrema Expert

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    New York
    Here is a short overview of what people have had to say about the impending death of the DOL Fiduciary Rule and what the future may bring.

    Cannot wait to get rid of it

    A recent article in the Investment News, talks about “Two insurance industry trade associations asked a federal court Wednesday to hurry up and kill the Labor Department’s fiduciary duty rule. In a letter to the 5th U.S. Circuit Court of Appeals, the American Council of Life Insurers and the National Association of Insurance and Financial Advisors said the court’s delay in issuing the mandate that makes effective its March 15 decision to vacate the rule is causing compliance headaches.”

    Others have also expressed a lack of support on the topic, claiming that the DOL never really defined “best interest” in the proposed rule.

    Signs of annuity market stabilization

    A June 8 article in PlanSponsor, cites data from Morningstar which “demonstrates variable annuity net assets fell 1.6% to $1.95 trillion during the first quarter of 2018, versus fourth quarter 2017 net assets of $1.99 trillion; still, experts anticipate sales to recover as regulatory pressure and uncertainty ease.”

    The senior product manager at Morningstar, John McCarthy had the following to say:

    “Variable annuities continue to face challenges regaining their footing in the wake of transaction processing disruptions born of the past few years’ efforts to comply with the now vacated Department of Labor (DOL) fiduciary rule, coupled with increased market volatility and negative net flows putting pressure on asset values. However, we expect sales to recover as business processes normalize and sales increase in newer product types, such as structured and fee-based annuities.”
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