What Happened:
For the past four years, Big I NY has been fighting a legal challenge against the New York Department of Financial Services (“DFS”) concerning Amended Insurance Regulation 187. The Amended Regulation 187 requires the “Producer” to act in the “Best Interests” of the customer. It also requires that the Producer make a “suitability” “recommendation” based on an analysis of their “needs.” In our view, the regulation is unfairly vague and extremely challenging for producers to comply with. We remain concerned that this will lead to reduced access to the trusted advice consumers deserve.
In 2021, the Appellate Court, 3rd Department, unanimously ruled in our favor and found the amended regulation to be unconstitutionally vague. NYS appealed this decision. Unfortunately, on October 20, 2022, our legal challenge came to an end when the New York Court of Appeals overturned the 2021 decision and issued a ruling in favor of the DFS.
What’s Next:
The Court of Appeals is the court of highest jurisdiction in NY, meaning this ruling is the final word. The amended regulation, therefore, remains on the books, and producers and companies must continue to comply with its various requirements. As a reminder, these requirements have been in effect continuously since August 2019 for annuities and February 2020 for life insurance products.
Big I NY Has Your Back:
Fighting for and serving you and your customers is the reason Big I NY exists. It is our purpose and our passion. We immediately recognized the need to challenge this unfair regulation and were, most importantly, committed to seeing it through to the end. While several groups filed suit in 2018, only Big I NY continued the fight through multiple appeals. While we are disappointed in the final ruling, we are proud to have taken a bold stand for our members. You can rest assured we will continue to fight on your behalf, even when the challenge is great.