The impact of the Department of Labor's “fiduciary rule” for financial advisers may last longer than the regulation itself, a top international ratings firm said Monday.
Fitch Ratings said that insurance companies have already made fundamental changes to the way they operate in order to comply with the Labor rule.
The Trump administration delayed implementation of the Labor rule — issued in April under President Obama — that aims to crack down on broker-dealers selling financial products without disclosing conflicts of interest.
“A significant portion of the changes implemented by life insurers … will remain in place, regardless of the outcome of a recently announced delay and review of the impact of the new rules,” said Fitch.
“These include the expansion of sales of fixed indexed annuities into the bank channel, some of the changes made to compensation structures in terms of fees and commissions, as well as enhanced record keeping and compliance functions.”
The Labor Department filed for a 60-day delay in applying the rule after Trump order the department to review the rule with a Feb. 3 executive order.