A NY producer recommends a 1035 exchange of one deferred annuity for another deferred annuity (same insurer, different contract). Which NY rule governs the producer's disclosure obligations on this internal replacement?

Question

EstatePass Inc. · Accepted Answer

Reg 60 (11 NYCRR 51) DOES apply to internal annuity replacements; the producer must complete the Disclosure Statement and follow the Important Notice procedure — NY Reg 60 (11 NYCRR 51) governs replacements of life insurance and annuities and explicitly reaches internal replacements — a producer cannot avoid Reg 60 by staying within the same insurer. The producer must deliver the 'Important Notice Regarding Replacement,' complete the Reg 60 Disclosure Statement showing the proposed and existing contracts side-by-side, and follow notice procedures. Option A is the common misconception. Option B ignores NY law layered on top of federal § 1035. Option D is wrong: Reg 60 and Reg 187 operate together — Reg 60 governs the replacement disclosure mechanics and Reg 187 governs the best-interest substantive standard.

A NY producer recommends a 1035 exchange of one deferred annuity for another deferred annuity (same insurer, different contract). Which NY rule governs the producer's disclosure obligations on this internal replacement?

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