On Aug. 1, 2019, New York’s first amendment to Regulation 187 went into effect. Insurers and producers must comply with the regulation immediately for any annuity-contract transaction and by Feb. 1, 2020, for any life-insurance-policy transaction.
Regulation 187 regulates recommendations made by a producer in the sale of a policy or certain in-force transactions. Most recently, some industry players filed a legal challenge, claiming that the best interest standard and other requirements imposed by the regulation are impermissibly vague and confusing. Two separate actions were filed and consolidated, but the challenge was dismissed. Currently, one of the two actions in the consolidated matter is being appealed. The regulation will remain in effect until a decision is made on appeal.
