The American Bankers Association’s Bank Insurance Council wrote to the Department of Labor on Monday seeking clarifications and changes to its fiduciary rule affecting banks that sell insurance. Specifically, ABA urged DoL to revise the rule’s definition of “investment property” to exclude products regulated as insurance by state authorities.
ABA also asked DoL to clarify that the rule does not apply to minimum distributions once funds have been distributed and that periodic distributions from retirement plans into insurance policies entered into before the rule takes effect are exempt. The effective date of the fiduciary rule has been delayed to June 10.
The rule, which expanded the definition of “fiduciary” under the Employee Retirement Income Security Act and the Internal Revenue Code, was the target of a recent executive action by President Trump, who directed the secretary of labor to thoroughly review the rule’s effect on Americans’ ability to access financial services.