L&HNew Yorkeasy
Under New York's Regulation 187 (11 NYCRR 224), what standard of conduct applies to producers recommending an annuity to a NY consumer?
ASuitability only — recommendation must be merely suitable based on customer information
BCaveat emptor — no producer duty applies
Best interest — recommendation must be in the consumer's best interest with care, skill, and diligence
DFiduciary duty under ERISA § 404 in all cases
Why this is the answer
NY Regulation 187, codified at 11 NYCRR 224, elevated the producer duty from NAIC suitability to a best-interest standard for both life and annuity sales effective 2019-2020. Option A is the pre-187 NAIC suitability standard, now superseded in NY. Option B is wrong because NY has long imposed producer duties. Option D conflates state insurance regulation with ERISA fiduciary rules — ERISA applies only to qualified plans, not all NY annuity sales. The Reg 187 standard explicitly requires care, skill, prudence, and diligence in evaluating the consumer's suitability information.
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