Annuity types, phases and taxation are covered in the national Annuities guide. Utah regulates annuity sales through its best-interest rule (R590-230) and its disclosure rule (R590-229). The free look is in the life statute (31A-22-423). This guide covers those rules.

Definition

An annuity is an agreement to make periodic payments where the making, continuance or amount of some payments depends on the continuance of human life (31A-1-301).

Best interest (R590-230)

• A producer recommending an annuity must act in the consumer's best interest (R590-230-2).
• Care obligation: make reasonable efforts to get the consumer's profile information.
• Documentation obligation: keep a written record of the recommendation and its basis.
• Insurer duties: run a supervision system and give producers product-specific training on all material features of its annuities (R590-230-4).
• Training: a one-time 4-credit-hour annuity course is required. Producers licensed for life after July 1, 2024 can't sell annuities until they finish it (R590-230-5).
• Records: kept for the current calendar year plus 3 years after the transaction (R590-230-7).

Disclosure (R590-229)

• Face-to-face sales: the disclosure document and the buyer's guide are given at or before the application.
• Other sales: they're sent within 5 business days after the insurer receives the completed application.
• The buyer's guide is the NAIC Buyer's Guide for Deferred Annuities, in fixed or variable versions (R590-229-3).

Free look

• 10 days after delivery for annuity contracts (31A-22-423).
• 30 days for a replacement, with an unconditional full refund (R590-93-5).

Guaranty protection

The Utah Life and Health Insurance Guaranty Association's covered amount for an annuity uses the lesser of $250,000 or the cash surrender value (31A-28-105).

Variable annuities

Variable annuities require the variable contracts line. That line requires a Utah broker-dealer agent license (31A-23a-206).

Common exam traps

• Annuity free look: 10 days, or 30 for a replacement.
• The disclosure and buyer's guide come at or before application face to face, or within 5 business days otherwise.
• Training is a one-time 4 hours.
• Records: the current year plus 3 years.