Nationwide Announces Upcoming Annuity Suite and New Partnerships

Additionally, in 2021, Nationwide will introduce several in-plan lifetime income options that pair income guarantees with TDFs.

Nationwide has announced that it will roll out a new suite of in-plan annuity products and partnerships with industry leaders, including at least five new solutions the company plans to implement from late 2020 through 2021.

“We know this is not a one-size-fits-all problem, and we’re confident that a suite of solutions will give plan sponsors the flexibility to select the option that’s best for their participants,” says Eric Stevenson, president of Nationwide Retirement Plans. “Our approach is unique, by going beyond retirees’ well-established need for guaranteed income, to also address their growing need to protect principal. It’s the combination of both benefits that makes our approach a game-changer for our industry.” 

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Nationwide says the Setting Every Community Up for Retirement Enhancement (SECURE) Act opened a new era of opportunity for retirement plan participants by expanding the ability for plan sponsors to help participants live in retirement. For example, the SECURE Act made in-plan annuities within defined contribution (DC) plans such as 401(k)s and 457(b)s more accessible and portable.

Nationwide’s new suite of products will offer a broad range of solutions for plan participants. In December, Nationwide will introduce a new in-plan fixed indexed annuity to provide principal protection with potential for growth based on the return of an index.

Additionally, in 2021, Nationwide will introduce several in-plan lifetime income options that pair income guarantees with target-date funds (TDFs), all designed to be qualified default investment alternative (QDIA) compliant.

“Similar to a target-date fund, we will allow our plan participants to select an investment option and then we’ll take care of the rest of the puzzle by providing a glide path from accumulation into retirement income,” Stevenson says.

Arkansas Is Latest State to Consider NAIC Annuity Sales Standards

The state’s Insurance Department Rule 82, which may soon be updated to match a suitability framework recently adopted by the National Association of Insurance Commissioners, seeks to address conflicts of interest among annuity providers and their proxies.

The Arkansas Insurance Department held a hearing Thursday afternoon to consider whether the state should permanently adopt modifications to a regulation known as Rule 82.

In basic terms, Rule 82 sets forth the standards and requirements that an insurance producer or an insurer must follow when recommending or selling an annuity product to a consumer in the state. The modifications in question would move Rule 82 into close alignment with the model annuity transaction suitability framework finalized early this year by the National Association of Insurance Commissioners (NAIC).

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By way of background, the NAIC is the United States’ main standard-setting and regulatory support organization created and governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer reviews and otherwise coordinate their regulatory oversight.

Supporters of the updated NAIC best interest framework include the Insured Retirement Institute (IRI), which says the revised suitability model is appropriately consistent with the U.S. Securities and Exchange Commission (SEC)’s Regulation Best Interest (Reg BI). In fact, the NAIC model includes IRI-recommended language to provide a safe harbor for all insurance producers who are subject to, and actually comply with, equivalent or greater conduct standards, such as Reg BI or the Investment Advisers Act. Supporters say this approach will help to avoid duplicative compliance requirements for those producers who already comply with rigorous standards.

In a statement shared with PLANADVISER ahead of the Arkansas hearing, Jason Berkowitz, IRI chief legal and regulatory affairs officer, spoke favorably of the state’s consideration of the NAIC framework.

“Similar to Reg BI, the regulation will require insurance producers to act in the best interest of the consumer under the circumstances known at the time a recommendation is made, without placing the producer’s or the insurer’s financial interest ahead of the consumer’s interest,” Berkowitz says. “In addition to the enhancements made to the applicable standard of conduct and supervisory requirements, the revised model also reflects important adjustments to the training provisions and the FINRA [Financial Industry Regulatory Authority] safe harbor included in the prior version of the model.”

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