The IAdCA meeting has been quite good this year. I have connected with a few people that I haven't seen in years and had some great conversations about regulatory issues that face our industry. It is always interesting to share a conference with marketing personnel because so often we can find ourselves at odds, but looked at differently we often share a common goal. It is just easy to lose site of that given our respective pressures on a day-to-day basis.
Yesterday I enjoyed the presentations of Jim Young from the Virginia Bureau of Insurance and Amy Sochard of FINRA. These days I often find myself looking for clues about what a federally regulated world will look like and it is of course notable that so much advertising must be filed with FINRA compared to state insurance regulators. When the FINRA discussion got into specifics it was primarily over the use of hypotheticals and how difficult they are to make helpful for the full range of products. We also discussed the new variable products regulation and while the comment period at FINRA ended in September 2008, the final reg is not expected before the end of this year at the earliest. FINRA received 18 comments and is working their way through the comments.
While Ms. Sochard appeared to be quite sincere in her appreciation for the comments, it certainly did not seem to be an example of how federal regulation would increase the speed with which regulatory change happens to meet new product development. I did come away with a sense that she would take back the additional comments and questions of the group and that there was some possibility that the issues raised could impact the final regulation, when it ultimately comes out.
Another interesting area of discussion in that session was Reg 151A. Ms. Sochard deferred to the pending litigation, but indicated that it would be a challenge to bring indexed annuities into the VA rules, but that is what she thought would be likely for FINRA regulated transactions. There was a discussion of trying to make the hypothetical rules apply and the challenges they pose. Both in the context of Rule 151A and variable products, I think there were helpful tips for the use of hypotheticals in FINRA-regulated materials.
Overall, I found both regulators' discussions of what they are focusing on in their advertising reviews today quite interesting and helpful. As advertising comes under increasing focus it has been a very good opportunity to have interactions with those who review it for their respective agencies. I look forward to hearing George Nichols from New York Life and Kelly Ireland from the ACLI bring their perspectives this morning. And then I hope for an easy trip home this afternoon!
