Confusion surrounding the Department of Labor’s fiduciary rule has caused insurance distributors to hold back on specific sales strategies and that could affect annuity sales this year, insurance company executives said. The rule, which raises investment advice standards into retirement accounts, also appears to be having an impact on the amount of money going into nonretirement accounts. “The DOL is creating confusion more than anything else, and so you’re seeing some of our distribution partners not coming forward with their specific plans, because they are waiting to see what the final rule is really going to be,” said Dennis R. Glass, president and CEO of Lincoln Financial, a major seller of variable annuities. New sales of variable annuities fell 21.4 percent to $101 billion in 2016 compared to 2015, Morningstar reported earlier this year. Nonretirement accounts have also been affected, Glass said in a conference call with analysts earlier this month. Originally set to go into effect April 10, the rule has been pushed back to June 9 in the wake of President Donald Trump’s victory election. “We continue to suspect that uncertainty regarding the DOL conflict of interest fiduciary rule may be distracting from marketing activities and playing a role in lower sales,” said John Matovina, president and CEO of American Equity Investment Life. “In some cases, registered representatives may be positioning money away from annuities and into managed money in anticipation of the fiduciary rule," he said. American Equity is a major seller of FIAs. In 2016 FIA sales rose 9.7 percent to a record $58.2 billion compared with 2015, industry tracker Wink's Sales & Market report said.
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