Insurance producers recommending and selling annuities are required to consider the client benefits and concerns associated with annuities and their impact on the particular client before recommending them. They must ensure that an annuity recommendation serve the client’s best interest and that the client will be able to benefit from one or more of the product’s features. For an annuity recommendation and sale to be deemed suitable and in the best interest of the client, an insurance producer must disclose certain information, including the important annuity features—resulting in any client advantages or disadvantages—to the client.

Students who have completed this course should be able to:

• Define suitability and the requirements of Regulation Best Interest in the context of an annuity transaction;
• Describe the client information required to perform an appropriate annuity suitability analysis and determine if an annuity recommendation is in the client’s best interest;
• List the types of information that must be disclosed when making an annuity recommendation;
• Identify those situations in which an insurance producer has no suitability or best interest obligation to the client; and
• Describe the recordkeeping obligations to which insurance producers are subject in connection with recommended annuity transactions.