Filed Under:Your Practice, Regulatory

Industry girds for DOL fiduciary rule

Phyllis Borzi, left, Assistant Secretary of U.S. Department of Labor. (Jose Luis Magana/AP)
Phyllis Borzi, left, Assistant Secretary of U.S. Department of Labor. (Jose Luis Magana/AP)

Insurance agents and brokers are awaiting with bated breath a revised proposal from the Department of Labor (DOL) that would establish new rules for sale of investment products to beneficiaries of company-sponsored retirement plans and IRAs.

The industry universally fears that such a regulation, if finalized, would eliminate commissions as a source of broker-dealer compensation for such accounts.

The DOL or EBSA proposal has generated a great deal of debate.

The current standards have been in effect since 1974. But, DOL officials contend in pursuing the new standard that times have changed.

Kerzner also said LIMRA research in 2012 indicated that only between 9 and 11 percent of consumers are prepared to pay commissions to get investment advice, while 55 percent prefer a flat fee. He said between 8 and 11 percent are prepared to pay an annual fee to get advice.

The DOL comments    

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Nichole Morford

Nichole Morford
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