NASD Has Created the Indexed Annuity Identity Crisis

At a conference in Boca Raton, Florida, sponsored by the Securities Industry Association, New York, Robert Glauber, chairman of the NASD, stated that equity indexed annuities are "subject to utterly ambiguous regulation because it isn't entirely clear to anyone whether they're insurance products or securities." This must come as a complete surprise to the 50 state insurance commissioners, who are completely clear about their state appointed responsibility and authority over the approval, marketing, and sale of indexed annuities by the licensed insurance agents in their state. With only a few exceptions, indexed annuities ARE fixed annuities, a category of insurance products Mr. Glauber correctly admits are subject to state insurance commissioners' regulation. But the NASD is muddying the public perception about the true nature and identity of indexed annuities, in their efforts to mount a propaganda campaign, in an attempt to get the SEC to transfer control and regulation of these products from the insurance departments, into their arena, for reasons which we will discuss in the future. While Mr. Glauber is apparantly confused about whether indexed annuities are insurance or securities products, the SEC and the insurance departments are not confused, and unless and until there is some official change in that definition and ruling, this kind of verbal attack against indexed annuities is uncalled for, and this interference and criticism, by the NASD into the business of the insurance industry, is completely out of line.