The DOL fiduciary rule: heralding the end of commissions (Opinion)
June 16, 2016 by Warren S. Hersch
Once the Department of Laborfiduciary rule starts to take effect in April of 2017, it’s a fair bet that industry costs will go up significantly, and not just in terms of compliance: Embedded into the rule is a provision that leaves advisors and insurers vulnerable to a class action lawsuit.
That legal exposure could prompt the industry to shift en masse to other options for complying with the rule. The safest and least costly of them — charging a no-conflict, level annual fee for investment advice — is likely what the Labor Department is expecting most advisors will adopt over time.
This shift would realize an unstated objective of the department: killing commissions as a viable method of compensation for most producers offering retirement advice involving variable or equity-based products. Click HERE to read more… LifeHealthPro articles require free registration to view
