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Wealth Adviser Daily Briefing: Fiduciary Consequences


Wealth Adviser Daily Briefing: Fiduciary Consequences

By Michael Wursthorn

The Wall Street Journal

Sep 29, 2016 5:30 am ET

The Obama administration’s new rule requiring brokers to act in the best interest of retirement savers doesn’t start to take effect until next year, but it is already transforming the financial-services landscape.

Nationwide Mutual Insurance Co. said Wednesday it will buy Jefferson National Insurance Co., an issuer of annuities that are marketed to financial advisers who prefer fee-based compensation arrangements with their clients, rather than sales commissions, reports WSJ.

The acquisition gives Nationwide access to a flat-fee variable-annuity platform that will help it adapt to the new regulation, known as the fiduciary rule, Nationwide President Kirt Walker told WSJ. He said half of Nationwide’s business is affected by the new rule.

The fiduciary rule, which is set to start taking effect in April, is expected to make life tougher for many different types of financial firms, including insurers that sell annuities. Many companies say they are still trying to figure out what changes they will have to make in their compliance departments, in addition to possible acquisitions or divestitures.


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