What You Need to Know
- The coalition that filed the new suit includes the ACLI, IRI, Finseca, NAFA, NAIFA and several NAIFA chapters.
- Another group filed a separate suit against the fiduciary rule regulations May 2.
- Appeals from either case would flow to the federal appeals court that rejected an earlier Labor Department fiduciary rule effort.
Nine insurance trade groups today joined to file a suit attacking the U.S. Labor Department’s new fiduciary rule regulations in the U.S. District Court for the Northern District of Texas.
The groups have accused the department of rushing to adopt the new retirement investment advice fiduciary definition regulations without meeting federal Administrative Procedures Act requirements, and without analyzing impact data in an adequate way while conducting a cost-benefit analysis.
The plaintiffs are the American Council of Life Insurers, the Insured Retirement Institute, the National Association for Fixed Annuities, Finseca, the National Association of Insurance and Financial Advisors, and NAIFA-Texas, NAIFA-Dallas, NAIFA-Fort Worth and NAIFA-POET.
Labor Department representatives did not immediately respond to an email seeking comment.
The background: The Labor Department has been working to impose a fiduciary rule on sellers of non-variable indexed annuities for years.
A fiduciary standard requires the people and companies subject to it to put the interests of clients first, rather than simply offer the clients products and services that appear to suit their needs.
In April, the department completed work on a regulation establishing the retirement investment advice fiduciary definition, using the definition to impose a fiduciary standard on people and companies that help savers roll assets from 401(k) plans and individual retirement accounts into other arrangements, and created limited exemptions from the new fiduciary definition for insurance agents and brokers who sell retirement savers life insurance and annuity products with an investment component.
