Decemeber 11, 2009 - NAFA undertakes a legislative strategy to overturn Rule 151A. Indexed annuities as securities? Not until 2013, says the SEC

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March 11, 2009 - NAFA undertakes a legislative strategy to overturn Rule 151A.

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Safe Harbor Financial President John Branton, CLU, ChFC, was in attendance at the Security and Exchange Commission (SEC) meeting on December 17 when Proposed Rule 151a, which considers Fixed Indexed Annuities securities, was adopted.

Immediate Impact to You
None. The targeted effective date for the rule is January 12, 2011. It is also very likely that legal action will be taken to try to prevent this rule from being implemented by its effective date.

You should stay focused on your business and continue to utilize these products to meet your customers' needs - especially in this economic environment. Many of your clients need the benefits of these extremely relevant products.

So, what's next for the Fixed Indexed Annuity agent?
Many of our carriers have been working on new products in the traditional fixed annuities arena. With these new products in development, you can look forward to continuing to grow your annuity business.

Most importantly, keep in mind - there is no need to take any sudden action. Safe Harbor Financial will continue to monitor everything related to Rule 151a and keep you abreast of developments and your best options.

Additional Details on 151a:

The vote by the SEC on Dec. 17, adopting Rule 151A, purports to classify most fixed indexed annuities as securities subject to federal oversight. If allowed to stand, the rule would apply to indexed annuities issued on or after January 12, 2011, and would require these products to be registered with the SEC as securities and sold by securities licensed individuals. SEC Commissioner Paredes, the lone dissenter in Wednesday's open meeting, very forcefully set forth the position that the SEC is overstepping its jurisdiction and specifically asked for his dissenting comments to be published in the Federal Register alongside the Rule.

Many organizations are committed to fighting this ruling. If the rule does survive the expected legal challenges, please keep in mind that it will only apply to sales of fixed index annuities after January 12, 2011. Many agents have asked if it would apply to Indexed Universal - the answer is NO, it will not apply to that product.

If you have further questions or need assistance, please contact Safe Harbor Financial at (800) 422-0557.

For Agent Use Only. Not to be used for consumer solicitation purposes. http://www.investmentnews.com/article/20091209/FREE/912099982