News

California Supreme Court Vacates Court of Appeal Decision in Williams v. National Western Life

On September 22, 2021, the California Supreme Court granted review of the anti-consumer decision in Williams v. National Western Life Insurance Company, which held that an agent who sold for multiple life insurers was the agent of the consumer, not the insurer, and that the insurer owed no duty of care to supervise the agent. …

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LICAC Proposes Expansion of Life Insurance Consumers’ Bill of Rights

The Life insurance Consumer Advocacy Center (“LICAC”) has added an additional protection to the Life Insurance Consumers’ Bill of Rights that it proposed  on September 18, 2020.  (See September 18, 2020 blog post) The new provision would overrule a recent California court case which held that an agent selling life insurance on commission for a…

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California Court Decision Immunizing Insurers From Responsibility For Their Agents Must Be Overturned by Statute

A June 2021 decision from a California appellate court held than an insurance company had no duty of care to supervise its agent and therefore was not liable for the agent’s misconduct, egregious as it was.  See Williams v. National Western Life Insurance Company, Case No. C090436 (Third Appellate District, June 11, 2021)  https://scholar.google.com/scholar_case?case=6723238997375948811&q=williams+v.+national+western+life+insurance&hl=en&as_sdt=2006  …

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New Study Shows Need to Protect Life Insurance Consumers from Dishonest Financial Advisors

A working paper released early in 2021, entitled Wandering Financial Advisors, shows that financial advisors who exit the broker-dealer regulatory regime because of misconduct frequently become (or remain licensed as) insurance producers, where they are more than ten times as likely to commit misconduct as insurance producers who exited the broker-dealer regulatory regime without a…

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NAIC’s Reform of Actuarial Guideline 49 Helps – But Falls Short

Insurance regulators have put into effect – presumed effective after Dec. 14, 2020 – more conservative rules for illustrating the popular index-based Universal Life policies sold by dozens of life insurance carriers.  Revising illustration rules was last attempted in late Summer of 2015 via Actuarial Guideline 49 (AG49), but newer products and their illustrated projections…

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LICAC Proposes Life Insurance Consumers’ Bill of Rights

The Life insurance Consumer Advocacy Center (“LICAC”) has proposed a bill entitled the Life Insurance Consumers’ Bill of Rights, with the goal of protecting consumers from losing their savings in Life Insurance Investment Schemes.  The concept for the bill was first discussed with representatives of the California Department of Insurance in February 2020.  The reforms…

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The NAIC’s New Model Regulation Governing Suitability in Annuity Transactions Misleads and Fails to Protect Consumers

In the Spring of 2020, the National Association of Insurance Commissioners (“NAIC”) adopted a new “model regulation” that purports to protect consumers by toughening the standards that must be followed by agents and insurers selling annuities to consumers.[1]  The new model regulation, called the Suitability in Annuity Transactions Model Regulation (No. 275), was met with…

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