Date: April 6, 2010
RE: New Texas Regulation to Impact North American Products
To: Texas North American Annuity Distributors and Producers
New regulations in the state of Texas will require changes to our existing fixed annuity products. These changes impact some issue ages and surrender charges on products North American offers in Texas (see below). Commission structure will be changing for some of the products (commissions will be reduced for the first year and another commission will be paid at the beginning of year two).
| | | Issue Age Changes | |
| Product | Surrender Charges | 10-Year | 14-Year | Commission Reduced |
| North American PrecisionSM | Changed | 60-79 | 56-75 | Yes |
| North American CharterSM | Changed | 60-79 | 56-75 | Yes |
| Formula Choice® | Changed | NA | NA | No |
| North American Freedom Choice® | Changed | NA | NA | No |
While the new regulation is effective June 1, 2010, North American is implementing the product changes effective May 1, 2010 to allow enough time for the completion of funds transfer and policy issuance of submitted business. After April 30, 2010, no new business will be accepted under the current product specifications and updated disclosures and brochures that incorporate these changes are required. If we haven't received funds on previously submitted business by May 31, 2010, a new signed disclosure will be required. New product materials will be available for order April 21.
In addition, the Texas regulatory changes will require us to discontinue several products in the state of Texas effective May 1, 2010. Those products to be discontinued are:
- North American Paramount Choice Ten®
- North American Ten®
- North American Prizm Plus®
- North American Flex Series (NA Flex I, NA Flex II, NA Flex IIISM)
- The Boomer Annuity®
- North American DirectorSM
- North American Guarantee ChoiceSM
- North American Freedom Choice® with the 5% penalty-free withdrawal option
If we haven't received funds on previously submitted business for these discontinued products by May 31, 2010, we will be unable to issue the policy and an application withdrawal letter will be sent to the customer.
For assistance with ordering new materials or questions regarding the changes, please contact Marketing Support at 866-322-7066.
Lori Bochner
Vice President Marketing & Sales Support
lbochner@sfgmembers.com
