The American Council of Life Insurers (ACLI) issued the following statement in response to Senator Elizabeth Warren (D-MA) and Rep. Elijah Cummings’ (D-MD) assertions regarding the industry’s position on the Labor Department’s proposed fiduciary regulation:

Washington, D.C. (February 12, 2016) — ACLI and its member companies have been clear and consistent: While life insurers may have no choice but to conform to the Labor Department’s final fiduciary regulation, the proposal as drafted would hurt lower- and middle-income consumers preparing for retirement.

Without significant changes to the department’s proposal, ACLI is concerned that there will be a dramatic decrease in:

• savings due to lack of access to investment and distribution education and guidance;
• the number of small business retirement plans for workers;
• guaranteed lifetime income solutions through annuities; workplace benefits such as life, disability income, long-term care, and other non-medical insurance products.

This is not just our opinion. Similar concerns were raised in multiple comment letters to the department signed by more than 300 members of Congress from both parties. Indeed, many of the more than 3,000 comments the department received from regulators, employers, retirement plan sponsors and others say that the proposal needs significant revisions to avoid unintended consequences for America’s savers.

ACLI agrees that financial professionals should work in consumers’ best interest. But Americans’ best interest will not be served by a regulatory scheme that hinders access to the advice and products that they want and need. 

ACLI is hopeful that the Labor Department will address the multiple concerns raised about the proposed regulation. We also support efforts to pass bipartisan legislation that would enhance consumer protections by ensuring savers and retirees maintain access to financial professionals who will be required to act in their clients’ best interest.