July 11, 2008
I am a licensed insurance agent, and am also Series 6 licensed. I could sell FIA's no matter which way the ruling goes. However, in my opinion an FIA is not a security product. The insurance company is crediting interest to the accumulation account based on the issuer's experience using an index formula. The principal is guaranteed by the insurance carrier and even a minimum interest rate.
It seems to me that if FIA's are brought under the jurisdiction of the SEC, there will be fees added to the product to cover the supervision, etc. Frankly, I don't think that the consumer will be protected any more than currently, and and could actually be hurt if the SEC ruling passes.
Please allow the insurance industry to continue to inforce its own compliance and suitability.
Thank you.
Bill Cowsill