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Annuities, life insurance not covered by CFPA

Posted On Thu, October 22, 2009

A measure that recently passed a House committee which would create a federal consumer protection agency will not include annuities or life insurance under its watch.

According to the Insured Retirement Institute (IRI), actions from Minnesota Republican Representative Erik Paulsen and Wisconsin Democratic Representative Gwen Moore kept life insurance and annuities out of the bill that passed the House Financial Services Committee. Both representatives clarified language in the bill that ended up excluding annuities and life insurance.

Cathy Weatherford, president and CEO of the IRI, said her organization will continue to work with members of Congress as the bill is debated.

"Today's action brings us one step closer to protecting consumers while allowing the industry to provide the best products in the most timely fashion," Weatherford said of the changes made by Paulsen and Moore.

According to the Insurance Information Institute, annuities may be an option for a number of people who are considering different investment strategies. There are a number of different kinds of annuities that offer various rates of return. For example, fixed annuities are backed by insurance companies, whereas variable annuities are tied to investment funds such as stocks.

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