OneAmerica Releases Adviser-Friendly Revenue Accounts
The OneAmerica revenue accounts allow advisers to move from commission-based compensation to a fee-based structure.
As the Department of Labor’s (DOL) fiduciary rule undergoes its first days of implementation, the retirement and financial services industry is pushing efforts to increase transparency around fees and potential conflicts of interest. In response, OneAmerica is rolling out what it calls adviser-friendly “revenue accounts.”
Created at the plan level, these accounts can be used to pay an adviser’s fee without the need for deductions from individual participant accounts. Commission amounts are credited to the plan’s revenue account under the OneAmerica recordkeeping system before being withdrawn and paid to the adviser as a fee.
“By doing so, we can pay that same amount to an adviser as a fee rather than a commission,” Terry Burns, assistant vice president of products and investments for OneAmerica Retirement Services, tells PLANADVISER. The arrangement is less conflicted, the firm argues, because the fee is agreed to in advance and will not vary depending on the specific product recommendations made.
Plans of any size will have access to these accounts and there is no plan minimum.
“This is a new and welcomed option for group annuity investments, because it makes retirement preparation easier for advisers and sponsors,” Burns argues. “We believe revenue accounts will help our distribution partners by providing a fee-based compensation versus a commission for the great work they do, particularly on behalf of the small and mid-size plan market, where plan sponsors often need help in their efforts to ensure their participants can retire comfortably.”
He adds that the firm “wants to help advisers who want to switch from commission to fees and still provide assistance to those smaller plans, so they can help their participants retire appropriately.”
OneAmerica’s latest move comes ahead of its expansion of its group annuity platform, which includes zero revenue-sharing funds.