Guaranty Income Life - DOL Rule Bulletin

by admin sunderland | Jun 05, 2017

Guaranty Income Life Insurance Company
June 5, 2017

Advisor Disclosures For Fixed Annuity Purchases with Funds from an IRA or other Qualified Retirement Plan

To Our Valued Business Partners and Producers:

As you are likely aware, effective June 9, 2017, the US Department of Labor’s (“DOL”) revised “Fiduciary Rule” under ERISA will take effect.

At GILICO, we know that our producers work hard each day to provide clients with excellent annuity products to help meet their savings and retirement needs; and your great work will continue. In accordance with the most recent DOL regulations, we expect all who sell GILICO’s products to familiarize themselves with and conduct your business according to these regulations as required by your agent contract. For your convenience, and to provide additional information on the evolving status of the Fiduciary Rule, we attach a link to the DOL Field Assistance Bulletin No. 2017-02.

In summary regarding the Fiduciary Rule, those currently engaged in selling GILICO’s fixed annuity products will be deemed fiduciaries of those clients purchasing with funds from an IRA or qualified retirement plan. It is important that you begin conducting such business in accordance with the Fiduciary Rule’s “Impartial Conduct Standards” -- this includes acting in the client’s best interest, accepting only reasonable compensation and avoiding misstatements in product presentations.

In order for advisors to meet their responsibilities under the Fiduciary Rule, we know that many organizations are circulating forms such as the attached “Disclosure Statement.” GILICO will not require submission of a company specific form; however, this form should aid you in conducting compliant sales and documenting important information for your clients. GILICO producers are reminded to begin using a disclosure statement – or a form substantially similar to the attached form – before completing any sale of a GILICO fixed annuity product with funds from an IRA or other qualified retirement plan, starting on June 9, 2017, and until further notice. You are expected to maintain such completed forms in your records for six years on each sale.

This will be the extent of business practice changes that GILICO will expect at this time. We are NOT making changes to your Selling Agreement contracts. Also we are NOT altering what we believe to be reasonable compensation levels for the important advisory services you provide your clients.

Given that the DOL’s approach and guidance on the Fiduciary Rule is evolving, we urge you to stay current on your responsibilities, watch for future updates that we may provide on and continue taking excellent care of GILICO policyholders.

Thank you for your business!