Utah
Utah Provides Guidance For Suitability In Annuity Transactions
Posted December 5, 2024, Utah Insurance Department issued a bulletin to provide guidance and reinforce the requirements for suitability in annuity transactions. Please see the attachment for more information.
The state clarified the following sections:
The state clarified the following sections:
- When making a recommendation for the sale of an annuity, including an exchange or replacement of an annuity, an insurer, and producer shall act in the best interest of the consumer under the circumstances known at the time the recommendation is made, without placing the producer’s or the insurer’s financial interest ahead of the consumer’s interest.
- In the case of an exchange or replacement of an annuity, the producer shall consider the entire transaction, which includes taking into consideration whether the consumer:
- Will incur a surrender charge, be subject to the commencement of a new surrender period, lose existing benefits, or be subject to increased fees, investment advisory fees, or charges for riders and similar product enhancements; or
- Has had another annuity exchange or replacement, including an exchange or replacement within the preceding 60 months.
- In the case of an exchange or replacement of an annuity, the producer shall consider the entire transaction, which includes taking into consideration whether the consumer:
- Will incur a surrender charge, be subject to the commencement of a new surrender period, lose existing benefits, or be subject to increased fees, investment advisory fees, or charges for riders and similar product enhancements; or
- Has had another annuity exchange or replacement, including an exchange or replacement within the preceding 60 months.
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