New York Reg 187 Tools

As all licensed agents in NY should be aware by now, a new regulation – “Best Interest” Regulation 187 – was implemented for ALL annuity sales in the state of NY, effective August 1, 2019. That same regulation is in effect for ALL NY life insurance sales, February 1, 2020.

The regulation applies to new sales, including replacements, and proper Reg. 60 paperwork is STILL required. The regulation also applies to certain transaction recommendations to clients on existing policies.

Our annuity carriers have been rolling out their respective guidelines which include new forms to comply with the regulation. Life insurance carriers have begun releasing their guidelines as well.  In most instances, a new supplemental form has/have been released to capture the information necessary to comply with the requirement to substantiate that the sale is indeed in the client’s “Best Interest.” In some instances it is actually new applications. There are also new training requirements necessary to be completed BEFORE an annuity or life insurance application is taken in NY. Read the final regulation in its entirety HERE.

It is important to note that it is the agent’s responsibility to ensure that all annuity and life insurance sales recommendations meet the “Best Interest” requirements, and to maintain client files demonstrating compliance. The new Regulation is specifically designed to impose a more stringent “Best Interest” standard in annuity and life insurance sales instead of the previous “suitability” standard that has historically been commonplace. All NY-licensed (resident and non-resident) producers are required to comply with the Regulation, and carriers are required to have processes in place to supervise producers’ compliance with the Regulation.

As mentioned, the producer will need to maintain documentation regarding recommendations and transactions completed for the client (e.g. justifying that product recommendations are in the Best Interests of the client) under the new Regulation.

To summarize:

• Carriers will produce forms (revised applications and/or supplemental forms) to be submitted to the carrier and/or maintained by the producer, to comply with the Regulation’s standards.

• A training component will be required BEFORE a producer can submit business to a carrier, effective August 1, 2019 for annuities and February 1, 2020 for life insurance sales.

• IMPORTANT: Each carrier may have its own approved training and courses in place. It is imperative that producers verify each carrier’s requirements before taking an annuity or life insurance application.

• IMPORTANT: The new training requirement does not take the place of any existing carrier/product training requirements which may already be in place. Some carriers may revise their product training to include the necessary material to comply with the new Regulation.

• IMPORTANT: Please note that there isn’t a universal course that will be accepted by every carrier (although most carriers will accept training via Limra, Kaplan and RegEd).Therefore it is important for each producer to verify what a specific carrier’s/product’s guidelines are prior to taking an application.

Here’s a chart detailing which training will be accepted by which carrier. Carrier specific product training is included for the carriers that have made it available at this time. We will continue to update this sheet as additional information is obtained.

Once you have completed the course, please print out your certificate of completion. Limra Training  RegEd Train

For further information regarding annuity or life insurance sales through Brokers Central and our carrier partners’ specific requirements, please contact a member of our Support teams.