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Will proposed fiduciary rule make insurance agents vulnerable to lawsuits?

Lawyers argue that the proposed DOL fiduciary rule improperly creates a private right of action that could set up class-action lawsuits against insurance companies and agents.

By Melanie Waddell | Updated on August 29, 2016
NAFA’s lawsuit asks for a preliminary injunction to stay the rule, which is currently set to take effect in April. (Photo: iStock)

Lawyers representing the National Association for Fixed Annuities told a U.S. District judge Thursday that individual insurance agents would be forced to become registered investment advisors under the Department of Labor’s fiduciary rule and that the current distribution system for fixed indexed annuities would have to be reworked.

Judge Randolph Moss, U.S. District judge for the District of Columbia, heard oral arguments for close to three hours Thursday in the first hearing against DOL’s rule, but did not immediately render a decision.

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