The Obama administration’s plan to make sure that savers get the best advice on retirement products will instead hurt the middle class, and insurers need to intensify efforts against the proposal, the head of an industry group said.
“This is government at its worst,” Dirk Kempthorne, chief executive officer of the American Council of Life Insurers, said Monday at the group’s annual conference in Chicago.
Stifel Financial Corp. and Voya Financial Inc. are among companies that have faulted the proposal as difficult to implement and counterproductive. MetLife Inc. CEO Steve Kandarian said it could discourage companies from providing financial advice, except to wealthy clients who pay substantial fees.
The Department of Labor says new rules are needed so that savers won’t be pushed into high-fee products by brokers who make commissions on the sales from banks or insurers. Given the government commitment to the plan, opponents should send letters and share their objections with lawmakers, said Kempthorne, a former Republican senator from Idaho.
“We face an uphill battle to fix the rule,” he said.
Deanna Mulligan, CEO of Guardian Life Insurance Co. of America, said that “our integrity is under attack” in the industry by people who aren’t convinced that companies do what’s best for the customers. She said insurers need to stress their role in helping families prepare for retirement.
“What we do is, in some part, a substitute for government dependence,” she said at the conference.