SB644,7,22 1. Having a reasonable basis to believe the consumer would benefit from certain features of the annuity, such as tax-deferred growth, annuitization, a death or living benefit, or other insurance-related features.

SB644,7,24 2. Making reasonable efforts to obtain consumer profile information from the consumer prior to the recommendation.

SB644,8,8 3. Considering the types of products the intermediary is authorized and licensed to recommend or sell that address the consumer's financial situation, insurance needs, and financial objectives. Nothing in this subdivision requires analysis or consideration of products outside the authority and license of the intermediary or other possible alternative products or strategies available in the market at the time of the recommendation. Under this subdivision, an intermediary shall be held to standards applicable to intermediaries with similar authority and licensure.

SB644,8,12 (be) If consumer profile information is obtained by an insurance intermediary, the insurance intermediary may not conceal the information from the insurer, and an insurance intermediary may not otherwise dissuade or attempt to dissuade the consumer from providing the information.

SB644,8,16 (c) The requirements under this subsection shall apply to the annuity as a whole, the underlying subaccounts to which funds are allocated at the time of purchase or exchange of the annuity, and any riders and similar product enhancements.

SB644,8,22 (d) The factors generally relevant in determining under this subsection whether an annuity effectively addresses the consumer's financial situation, insurance needs, and financial objectives shall be the consumer profile information, characteristics of the insurer, and product costs, rates, benefits and features. The level of importance of each factor may vary depending on the facts and circumstances of a particular case, and no factor may be considered in isolation.

SB644,8,24 (e) Nothing in this subsection requires that an annuity with the lowest one-time or multiple occurrence compensation structure be recommended.

SB644,9,4 (f) Nothing in this subsection requires that the insurance intermediary have an ongoing monitoring obligation, although such obligation may be separately owed under the terms of a fiduciary, consulting, investment advising, or financial planning agreement between the consumer and intermediary.

SB644,9,7 (g) In the case of an exchange or replacement of an annuity, the insurance intermediary shall consider the whole transaction, which includes taking into consideration all of the following:

SB644,9,11 1. Whether the consumer will incur a surrender charge, be subject to the commencement of a new surrender period, lose existing benefits, including death, living, or other contractual benefits, or be subject to increased fees, investment advisory fees, or charges for riders and similar product enhancements.

SB644,9,13 2. Whether the replacing product would substantially benefit the consumer in comparison to the replaced product over the life of the product.

SB644,9,15 3. Whether the consumer has had another annuity exchange or replacement, particularly within the preceding 60 months.

SB644,9,17 (h) 1. Subject to subd. 2., an insurance intermediary shall have no obligation to a consumer under this subsection if any of the following applies:

SB644,9,18 a. The intermediary made no recommendation.

SB644,9,20 b. The intermediary made a recommendation that is later found to have been prepared based on inaccurate material information provided by the consumer.

SB644,9,22 c. The consumer refuses to provide relevant consumer profile information and the annuity transaction is not recommended.

SB644,9,24 d. The consumer decides to enter into an annuity transaction that is not based on a recommendation made by the intermediary.

SB644,10,3 2. An insurer's issuance of an annuity under the circumstances specified in subd. 1. a. to d. shall be reasonable under all circumstances actually known to the insurer at the time the annuity is issued.

SB644,13 Section 13. 628.347 (2c) of the statutes is created to read:

SB644,10,9 628.347 (2c) Disclosure obligation. (a) Prior to the recommendation or sale of an annuity, an insurance intermediary shall prominently disclose to the consumer, on a form substantially similar to Appendix A of the National Association of Insurance Commissioners Annuity Suitability Model Regulation that shall be posted on the office's Internet site, all of the following information:

SB644,10,11 1. A description of the scope and terms of the intermediary's relationship with the consumer and the role of the intermediary in the transaction.

SB644,10,14 2. An affirmative statement on whether the intermediary is licensed and authorized to sell fixed annuities, fixed indexed annuities, variable annuities, life insurance, mutual funds, stocks, bonds, and certificates of deposit.

SB644,10,17 3. An affirmative statement describing the insurers for which the intermediary is authorized, contracted, appointed, or otherwise able to sell insurance products, using whichever of the following descriptions is appropriate:

SB644,10,18 a. From one insurer.

SB644,10,19 b. From 2 or more insurers.

SB644,10,20 c. From 2 or more insurers although primarily contracted with one insurer.

SB644,11,2 4. A description of the sources and types of cash compensation and noncash compensation to be received by the intermediary, including whether the intermediary is to be compensated for the sale of a recommended annuity by commission as part of a premium or other remuneration received from the insurer or another intermediary, or by fee as a result of a contract for advice or consulting services.

SB644,11,4 5. A notice of the consumer's right to request additional information regarding cash compensation.

SB644,11,6 (b) Upon request of the consumer or the consumer's designated representative, an insurance intermediary shall disclose all of the following: