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Allison Bell

Life Health > Running Your Business

What Bermuda's New Rules Really Mean, and 9 Other Burning Questions

By Allison Bell

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What You Need to Know

  • As 2023 passes, relatively quietly, attention shifts to pressing issues for the coming year.
  • That mean more discussion around the Labor Department's fiduciary standard rules on annuity professionals.
  • Interest rates and borrowers' ability to refinance will be watched as they relate to industry investment portfolios.

What might be the most surprising thing about 2023 is that, for life insurance and annuity market players, it wasn’t all that surprising, or cataclysmic.

Interest rates were fine. Credit markets were uneasy but, mostly, fine. Sales were great.

The U.S. Department of Labor revived its effort to impose broad fiduciary responsibilities on anyone using retirees’ rollover assets to pay for annuities, but the actual rules haven’t changed yet.

The top question for 2024 will be about the efforts by the Bermuda Monetary Authority to update its capital accounting rules, to respond to suggestions that U.S. life and annuity businesses is moving there because Bermuda is a relatively easy capital grader.

If Bermuda goes ahead with a capital rules update, how much effect will the changes really have, and how will that affect which insurers are hot and which are not?

And here are nine other questions for the new year.

2. Will interest rates stay friendly?

3. Will borrowers’ problems with refinancing office mortgages and other forms of debt shake life and annuity issuers’ giant investment portfolios?

4. Will the Labor Department succeed at imposing broad, tough new fiduciary standard rules on annuity professionals who help clients with retirement asset rollovers, and, if so, will U.S. rollover rules continue turn in the opposite direction every time control of the White House passes between political parties?

5. Will the Labor Department’s independent contractor rule force agents and advisors who absolutely want to be their own boss to get bosses?

6. Will Congress really let the federal estate tax exemption return to 2017 levels on New Year’s Day in 2026? (That would mean the exemption for an individual would fall to about $7 million, from $12.92 million this year.)

7. Will lifetime income annuities, which can protect clients who live a long time from running out of money, finally get U.S. retirement savers’ attention?

8. Will managing the derivatives inside registered index-linked annuities really turn out to be overwhelmingly cheaper, simpler and better than managing portfolios of stock funds inside traditional variable annuities, or will some swing of a pendulum help traditional variable annuities make a comeback?

9. What will death do?

10. Is Jon Godfread, the North Dakota insurance commissioner and the 2024 president-elect of the National Association of Insurance Commissioners, really the tallest public official in the world? Could the United Nations help us verify that?

Allison Bell

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