ACLI opposes proposal for annuity sales.

Proposed new federal regulations governing suitability in the sale of deferred variable annuities are just a form of "regulatory grandstanding," and are not needed because adequate regulations already exist, said a vice president with the American Council of Life Insurers.

The National Association of Securities Dealers, now known only as "NASD," is responsible for the operation and regulation of Nasdaq and the over-the-counter securities markets and has had its eye on sales and exchanges of deferred variable annuities.

On April 26, NASD proposed new requirements governing sales-practice standards, supervision, increased disclosure and sales-torte training.

Concerns about unsuitable recommendations and inadequate supervision are what prompted NASD's increased attention the past two years, according to Robert Glauber, NASD's chairman and chief executive officer. "We believe this rule proposal represents an appropriate approach to ensuring adequate protection for investors considering or purchasing deferred variable annuities."

The NASD has more than adequate existing suitability regulations that apply to variable-annuity sales, said Carl Wilkerson, vice president and chief counsel for the ACLI. The NASD also has embellished those suitability standards with four detailed notices, he added.

In general, the new rule would codify and make mandatory best-practice guidelines that NASD had previously issued, the agency said.