Fidelity & Guaranty Life Insurance Company continues to look for ways to improve our suitability review process while maintaining strong compliance standards and practices consistent with regulatory requirements and our own commitment to ethical market conduct.
The company is pleased to announce today we are introducing a new Suitability Acknowledgement Form and several process improvements that we hope will further enhance your experience working with our company. While the new form resembles our existing form in many ways and continues to uphold the standards of our program, we have made various adjustments and improvements in a continuing effort to expedite suitability review processing and minimize time-consuming follow up questions.
Some of the things you will notice about this new Suitability Acknowledgment Form compared to our existing form:
- It is redesigned and reformatted to be user friendly and more intuitive.
- Product information is removed since that is captured already on the application.
- The financial experience question has been simplified.
- Liquid asset and non-liquid asset listings are broken down more logically.
- Some arithmetic is removed from the financial information page such as calculating remaining liquid assets.
- The question on anticipated distributions is clarified to minimize mistakes.
- Disclosure on surrender charges for our annuity has been repositioned as a question and clarified with respect to multi-year guarantee annuities.
- Source of funds information is better spelled out to help avoid follow up questions.
- Narrative rationale is no longer required except in cases of replacement.
We are also taking other steps to improve the process including hiring additional staff resources to improve turnaround times and strengthen overall review. We are developing a “smart application” to assist agents at point of sale in completing the suitability form for certain products such as MYGAs (more will be coming out on that at a later date). And we have made certain changes to our suitability criteria that bring our company more in line with current industry standards including:
- We now give 100% credit for Market Value Adjustments (MVA) on replaced annuities as an offset against surrender charges.
- We now permit lump-sum distributions from defined benefit plans to be exchanged into our annuities without quantitative restrictions recognizing such funds are by definition intended for retirement and appropriate for placing in an annuity.
The new Suitability Acknowledgment Form together with our updated Instructions and Definitions and Agent Suitability Guide are attached. As always, you are encouraged to review these documents closely to familiarize yourself with our program. All these documents can be easily accessed on SalesLink.
If you have any questions about this bulletin or the attached document, please contact us directly at salesdesk@fglife.com. Thank you for your continuing business with Fidelity & Guaranty Life and your interest in good compliance practices.
Sincerely,
The FGL Team
