As far as Annuity Best Interest training... Let me boil it down for you:
If you want to sell Annuities in WI, you have to FIRST take a minimum of 4 hours of approved
"Annuity Best Interest" training. This training used to
be called "Annuity Suitability", but the requirement has changed and all
agents that want to write annuities in WI must take the new training
class. No exceptions.
CEWisconsin.com provides this approved training for CE credit. We have a 6 hour course that covers all the required topics, and counts toward your 24 credit CE commitment. The details from the WI OCI regarding Best Interest training are at the bottom of this page.
You can purchase credits to cover this class
and view class materials via the menu link on the
home page. You don't purchase classes at CEWisconsin.com, you just
purchase credits and use those credits toward any classes you want to
take. So just buy the number of credits you want to complete and then
come back to the home page and take any classes, anytime!
CEWisconsin.com Wisconsin Annuity Training
Annuity Best Interest Credit Hours
6 (satisfies WI
minimum 1-credit and 4-credit requirement)
Annuity Best Interest Training"
fulfills the Wisconsin Annuity Best Interest Training requirement for agents who wish
to sell annuities. It also counts toward the WI 24-hour CE requirement.
Insurers, Intermediaries, and Interested Parties
FROM: Nathan Houdek, Commissioner of
Best Interest Law (2021 Wis. Act 260)
bulletin summarizes a recently enacted law that affects the
insurance industry. The Wisconsin Office of the Commissioner of
Insurance (OCI) is providing this summary to make insurers,
intermediaries, and interested parties aware of the changes.
Those affected by these laws should check the statutes for the
Interest Law (2021 Wis. Act 260)
On April 15,
2022, Governor Evers signed 2021 Wis. Act 260 which adopted the
best interest standard for annuity sales based on the National
Association of Insurance Commissioners (NAIC) model law. A copy
of the Act may be found
here. The law revises the annuity
suitability standards found in Wis. Stat. §628.347 to provide
greater protections for consumers who purchase annuity products.
The NAICs FAQs related to the model law and its development may
The new law
requires that when recommending the sale of an annuity,
insurance intermediaries act in the best interest of the
consumer and not place their own financial interests ahead of
those of the consumer. An insurance intermediary has acted in
the best interest of the consumer if the intermediary satisfies
the Act’s care, disclosure, conflict of interest, and
intermediaries must satisfy the care obligation when
recommending an annuity. To comply with the care obligation, an
insurance intermediary must:
1. Know the
consumer's financial situation, insurance needs, and financial
Understand the product options available to the intermediary for
3. Have a
reasonable basis to believe the recommended option effectively
addresses the consumer's financial situation, insurance needs,
and financial objectives over the life of the product.
Communicate the basis of the recommendation to the consumer.
determining whether an annuity is appropriate for a consumer,
the insurance intermediary must have a reasonable basis to
believe the consumer would benefit from certain features of the
annuity, such as tax-deferred growth, annuitization, or a death
or living benefit. An insurance intermediary must also make
reasonable efforts to obtain consumer profile information from
the consumer prior to the recommendation. Before making a
recommendation, insurance intermediaries must consider all the
products they are authorized to sell that would meet the
consumer’s needs, in addition to annuities.
factors in determining whether an annuity is appropriate are the
consumer's financial situation, insurance needs, and financial
objectives as derived from the consumer profile information.
Other relevant factors include the characteristics of the
insurer, and product costs, rates, benefits, and features. The
level of importance of each factor may vary depending on the
facts and circumstances of a particular case.
In the case
of an exchange or replacement of an annuity, the insurance
intermediary shall consider all of the following:
the consumer will incur a surrender charge, be subject to the
commencement of a new surrender period, lose existing benefits,
or be subject to increased fees or charges.
the replacing product would substantially benefit the consumer
in comparison to the replaced product over the life of the
the consumer has had another annuity exchange or replacement,
particularly within the preceding 60 months.
Intermediaries may not recommend an exchange or replacement if
the product would not be in the consumer’s best interest based
on any of these considerations.
intermediaries do not have a care obligation to the consumer if
the intermediary made no recommendation or a recommendation is
made based on inaccurate information provided by the consumer.
Insurance intermediaries also do not have a care obligation if
the consumer refuses to provide relevant consumer profile
information and the annuity transaction is not recommended, or
the consumer decides to enter into an annuity transaction that
is not based on a recommendation made by the intermediary.
includes additional disclosure requirements that an insurance
intermediary must provide prior to a recommendation. Those
description of the scope and terms of the intermediary's
relationship with the consumer and the role of the intermediary
in the transaction.
statement describing whether the intermediary is licensed and
authorized to sell fixed annuities, fixed indexed annuities,
variable annuities, life insurance, mutual funds, stocks, bonds,
and certificates of deposit.
statement describing the insurers for which the intermediary is
authorized to sell insurance products.
description of the sources and types of cash compensation and
noncash compensation to be received by the intermediary,
including, for example, whether the intermediary is to be
compensated for the sale of a recommended annuity by commission
as part of a premium or by fee as a result of a contract for
advice or consulting services.
5. A notice
of the consumer's right to request additional information
regarding cash compensation.
of the consumer, an insurance intermediary must disclose a
reasonable estimate of the amount of cash compensation to be
received by the intermediary and whether the cash compensation
is a onetime or multiple occurrence amount.
Insurance intermediaries must make these disclosures on a
form substantially similar to the form found here on OCI’s
making a recommendation, an insurance intermediary must have a
reasonable basis to believe the consumer has been informed of
various features of the annuity, including the potential
surrender period and surrender charges, potential tax penalty if
the consumer sells, exchanges, surrenders, or annuitizes the
annuity, riders and other options, limitations on interest
returns, potential changes in non-guaranteed elements of the
annuity, insurance, and investment components, and market risk.
of Interest Obligation
intermediaries are required to identify and avoid or reasonably
manage and disclose material conflicts of interest.
intermediary is required to create a written record at the time
of making a recommendation or sale of an annuity. The written
record must include the basis for the recommendation.
consumer refuses to provide consumer profile information, the
insurance intermediary must obtain a signed statement from the
consumer that documents the consumer’s refusal to provide the
information and the consumer’s understanding of the
ramifications of not providing the information. The signed
statement must be on a form substantially similar to
the form found here on OCI’s website.
annuity is not recommended, the insurance intermediary must
obtain a signed statement from the consumer that acknowledges an
annuity transaction is not recommended if the consumer decides
to enter into an annuity transaction without a recommendation.
The signed statement must be on a form substantially similar to
the form found here on OCI’s website.
The Act also
includes some additional responsibilities for insurers in
supervising annuity sales. First, insurers must establish and
maintain procedures to detect sales that are not in the
consumer’s best interest. Second, insurers must establish
procedures for ensuring that an insurance intermediary has
satisfied the disclosure obligations of the Act. Insurers must
also establish procedures for identifying and addressing
suspicious refusals by consumers to provide consumer profile
information. Finally, insurers are required to eliminate any
sales contests, sales quotas, bonuses, and noncash compensation
that are based on the sales of specific annuities within a
limited period of time.
may not issue an annuity recommended to a consumer unless there
is a reasonable basis to believe the annuity will effectively
address the particular consumer's financial situation, insurance
needs, and financial objectives based on the consumer's consumer
current suitability requirements, recommendations of annuities
made by Financial Professionals in compliance with comparable
standards satisfy the requirements of the best interest
requirement. “Financial Professionals” include broker-dealers
registered under federal or state securities law, investment
advisers registered under federal or state securities law, and a
plan fiduciary under the Employee Retirement Income Security
even if an annuity is recommended under a comparable standard,
OCI retains the right to remedy and investigate annuity sales
that violate the best interest standard. In other words, annuity
recommendations that do not meet the best interest standard also
fail to comply with comparable standards and are subject to OCI
interest changes to the annuity suitability law also include new
training requirements. Insurance intermediaries who have
previously completed the four-credit annuity training must
either take a one credit training course regarding the best
interest changes or take a new/updated four-credit annuity
training course which includes information on the best interest
standard. Intermediaries seeking to become authorized to sell
annuities for the first time must take the new/updated
four-credit course. Intermediaries who have previously completed
the annuity training have until April 1, 2023, to complete this
of a substantially similar training in another state will
satisfy the training requirements in Wisconsin. Intermediaries
can access available Wisconsin courses via the following link on
requirement in the existing law continues in that each insurer
must verify that the intermediary has completed the required
training. Insurers are also required to establish standards for
intermediary product training and to provide product-specific
training and training material that explains the company's
annuity product to its intermediaries prior to soliciting the
in this Act become effective October 1, 2022.