Annuity Best Interest Training – NAIC Model #275 Information

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At the time of this writing (August 23, 2023), 41 states have adopted the “best interest standard” for annuity sales. In 2020, the NAIC (National Association of Insurance Commissioners) enacted a best interest standard as a revision to Suitability in Annuity Transactions Model Regulation (#275), or NAIC Model #275.

Since the NAIC put out this new standard, each state can take it up as its own. Now, what does this mean for annuity agents and other financial professionals? More training and higher obligations of care and disclosure, among other things. The annuity best interest training requirement applies on a state-by-state level. If you count on writing annuity business, you must complete a course by the “training” date outlined in the table below.

In most states, this new training on the best interest standard for annuity sales is an hour long. Of course, that is assuming that you didn’t complete the four-hour existing course on annuity suitability before the “Annuity Best Interest Compliance Date,” noted for each respective state in the document below. If you weren’t licensed in a respective state or hadn’t completed the original four-hour training before the Annuity Best Interest Compliance date, a four-hour Best Interest training course will need to be completed.

Depending on whether you are a new or existing producer will affect the Training Compliance Date which applies to you. If you don’t complete the course by the Training Compliance Date, then any business you do after the Training Compliance Date will be in NIGO status, and you will need to complete the four-hour Best Interest course.

There are also new and updated measures for producers to uphold under the NAIC best interest standard. This can be rather complex at times, and it affects annuity sales with qualified and non-qualified money.

If you have any questions about how these updates affects your practice, you can catch a free copy of our 20-pg agent guide by scrolling to the bottom of this page. Call us at (800) 790-7791 if you have any further questions about annuity best interest, the NAIC best interest standard, and how it may apply to your business.


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