US SEC Fights To Defend Indexed Annuities Rule In Court

The Securities and Exchange Commission fought to defend regulation of indexed annuities in a federal appeals court Friday as a panel of judges questioned whether the agency had followed proper rule-making procedures.

The SEC is being challenged by the insurance industry and state insurance regulators over new rules which classify indexed annuities as securities, subjecting them to federal oversight.

The case hinges on the principle of risk, and whether or not the uncertainty of receiving additional returns tied to a stock index is enough to subject them to federal disclosure requirements.

But the judges also took particular interest in the technical aspects of the SEC's rule-making process, including whether or not the agency had based its rule in part on an analysis of how the proposal might impact competition...

WSJ: US SEC Fights To Defend Indexed Annuities Rule In Court