The national Annuities guide covers how annuities work: phases, fixed, indexed and variable products, payout options, surrender charges, 1035 exchanges and taxes. This guide covers the Wyoming rules: the best interest standard in Rule Ch. 64, required annuity training, replacement and guaranty protection.

Who may sell

• Fixed and indexed annuities are sold under the life line, which includes annuity benefits (26-9-207(a)(i)).
• Variable annuities need the variable line. The applicant must have passed FINRA Series 6 or 7 and Series 63.
• A producer completes a one-time 4-credit annuity training course approved by the Department before selling annuities (Ch. 64 Sec. 6).

Best interest (Rule Ch. 64)

A producer recommending an annuity acts in the consumer's best interest and doesn't put the producer's or insurer's financial interest ahead of the consumer's. The producer must have a reasonable basis to believe the recommendation meets the consumer's financial situation, insurance needs and financial objectives.

• Consumer profile:
  • age, income, financial situation and objectives
  • time horizon
  • liquidity needs and liquid net worth
  • risk tolerance
  • tax status, among others
• Exchanges and replacements: the producer weighs surrender charges, lost benefits, added fees, whether the consumer benefits substantially, and any exchange in the past 60 months.
• What the standard doesn't do: create a fiduciary duty, or require the lowest-compensation product.
• Exempt transactions include contracts funding ERISA and certain employer plans, personal injury settlements and formal prepaid funeral contracts.
• Records: insurers, agencies and producers keep them three years after the transaction (Ch. 64 Sec. 8).

Replacement

• When an annuity replaces existing coverage, the replacing insurer gives a 30-day unconditional refund right from delivery (Rule Ch. 12). The existing insurer is notified within three working days.

Guaranty protection

The Wyoming Life and Health Insurance Guaranty Association covers up to $250,000 in present value of annuity benefits, including cash surrender and withdrawal values (26-42-103). It can't be used to sell a policy.

Common exam traps

• Best interest isn't a fiduciary duty and doesn't require the cheapest product.
• The look-back for prior exchanges is 60 months.
• Wyoming keeps best-interest records 3 years.
• Annuity training is a one-time 4 credits.
• A replacement annuity gets 30 days to return, and the existing insurer is notified within 3 working days.
• Annuity guaranty coverage is $250,000.