Can “Caveat Emptor” Become “Vende Diligenter?”.

Following New York’s highest court’s reinstatement of New York Insurance Regulation 187 in October 2022, consumer advocates have been hopeful that customer-focused standards supporting client best interest and only suitable products would next be adopted in California. As it happened, the California Department of Insurance had concerns over NAIC’s Model Annuity Suitability Regulation not going far enough to place the buyer’s interests above those of the seller (the agent or the carrier) and was inspired to press for New York-style regulations covering not just the sale of annuities but also life insurance. While 36 states have (as of April 2023) adopted the NAIC regulation, California has yet to do so, but is obligated to adopt at least minimum standards by 2025 or be in peril of federal intervention. The timing seemed appropriate for enhanced protection for consumers buying cash value life insurance and annuities. But during California’s harsh winter and early spring, strong headwinds pushed hard on more than its fragile climate. [ABSTRACT FROM AUTHOR]