Pennsylvania Update – Annuity Best Interest Training


Licensed insurance producers who are currently authorized to sell annuity products in Pennsylvania and who want to sell annuities on or after June 20, 2022, must take an Annuity Best Interest (Annuity BI) certification course offered by an approved provider. The updated training courses will include adopted NAIC’s 2020 Model Law #275 best-interest standards, which among other changes, outline the requirement for producers to act in the best interest of the consumer at the time the annuity recommendation is made.

Required Training

The topics that must be covered by the training course are set out in Section 403.1-B(A) of Act 99 and shall include information on:

  • The types of annuities and various classifications of annuities;
  • Identification of parties to an annuity;
  • How fixed, variable and indexed annuity contract provisions affect consumers;
  • The application of income taxation of qualified and nonqualified annuities;
  • The primary use of annuities; and
  • Appropriate standard of conduct, sales practices, and requirements for replacement and disclosure.

New Pennsylvania Annuity Best Interest Training Requirement

Pennsylvania resident producers who are already licensed and certified to sell annuity products in the state of Pennsylvania prior to June 20, 2022 have a 6-month grace period to complete an additional 1-hour of Annuity Best Interest training. The training course must be completed no later than December 20, 2022. Resident producers will be able to earn insurance continuing education towards their license renewal. Producers eligible to complete the 1-hour Annuity Best Interest course can also elect to take the 4-hour Annuity Best Interest certification training course if they desire.

Pennsylvania resident producers who become licensed on or after June 20, 2022, or those who fail to complete the 1-hour course prior to December 20, 2022, must complete a one-time 4-hour Annuity Best Interest certification training course prior to selling, soliciting, or negotiating annuity business in the state of Pennsylvania.

Frequently Asked Questions

Pennsylvania Insurance Department has more information on their webpage including answers to more FAQs. Visit their site at PID Annuity Best Interest Standard.

Who needs to complete the new training?

All producers who engage in the sale of annuities in the state of Pennsylvania, including those registered with FINRA, must complete the training required by the revised model.

When is the training due?

Producers who already took an Annuity Suitability program and who are currently certified to sell annuities in Pennsylvania need to complete either:

1-Hour Annuity Best Interest course between June 20, 2022 – December 20, 2022

OR

4-Hour Annuity Best Interest course after June 20, 2022 and before the sale, solicitation or negotiation of an annuity product in Pennsylvania.

A producer who has NOT completed the Annuity Suitability training requirements under the prior version of the model must complete the required training after June 20, 2022 and before the sale, solicitation or negotiation of an annuity product in Pennsylvania.

What if a producer does not complete the required training?

A producer who fails to satisfy the training requirements is not permitted to recommend or sell annuities. A producer who recommends or sells annuities without completing the required training may face enforcement action by the Pennsylvania Insurance Department.

Will a producer get CE credit for taking the new annuity best interest training?

Yes, courses must be approved by the Pennsylvania Insurance Department under course category of “Annuity Best Interest 1” or “Annuity Best Interest 4”. These courses are approved for insurance continuing education towards your license renewal and it is the education providers responsibility to post these credits to your transcript. InsuranceStudy will have both courses available in our catalog at https://www.insurancestudy.com/courses/pennsylvania-insurance-continuing-education. Courses will not be available until June 20, 2022 when the rule takes effect.

How does a producer show that they have met the new annuity best interest training requirement?

The producer may be asked by the insurer to provide a certificate of completion of the training course in order to satisfy the insurer’s responsibility under the Regulation. Certificates of Completion are provided by InsuranceStudy at the completion of your course and can be downloaded at any time from your course dashboard. Additionally, InsuranceStudy is an approved ClearCert provider and all course completions will be reported to ClearCert so that carriers may verify a producer’s certification status at any time. The Pennsylvania Insurance Department will not track the training course completions for producers. It is the insurer’s responsibility to verify that the producer has completed the training.