Title: Registration for Index-Linked Annuities Act
Policy area: Finance and Financial Sector

Summary:
Registration for Index-Linked Annuities Act
This bill requires the Securities and Exchange Commission (SEC) to create a new form for the registration of index-linked annuities to ensure that a purchaser can make a knowledgeable decision.
The bill defines a registered index-linked annuity as an annuity that is deemed a security, that must be registered with the SEC, and that is issued by an insurance company subject to state supervision. Furthermore, the returns of these annuities (1) are based on the performance of a specified benchmark index or rate, and (2) may be subject to a market value adjustment if amounts are withdrawn early.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 3198 Introduced in Senate (IS)]

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117th CONGRESS
  1st Session
                                S. 3198

 To direct the Securities and Exchange Commission to revise any rules 
necessary to enable issuers of index-linked annuities to register on a 
 form tailored specifically to registered index-linked annuities, and 
                          for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            November 4, 2021

 Ms. Smith (for herself and Mr. Tillis) introduced the following bill; 
which was read twice and referred to the Committee on Banking, Housing, 
                           and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
 To direct the Securities and Exchange Commission to revise any rules 
necessary to enable issuers of index-linked annuities to register on a 
 form tailored specifically to registered index-linked annuities, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Registration for Index-Linked 
Annuities Act''.

SEC. 2. PARITY FOR REGISTERED INDEX-LINKED ANNUITIES REGARDING 
              REGISTRATION RULES.

    (a) Definitions.--In this section:
            (1) Commission.--The term ``Commission'' means the 
        Securities and Exchange Commission.
            (2) Investment company.--The term ``investment company'' 
        has the meaning given the term in section 3 of the Investment 
        Company Act of 1940 (15 U.S.C. 80a-3).
            (3) Market value adjustment.--The term ``market value 
        adjustment'' means, with respect to a registered index-linked 
        annuity--
                    (A) an adjustment to the value of that annuity 
                based on calculations using a predetermined formula; or
                    (B) a change in interest rates (or other factor, as 
                determined by the Commission) that applies to that 
                annuity after an early withdrawal or contract 
                discontinuance.
            (4) Purchaser.--The term ``purchaser'' means a purchaser of 
        a registered index-linked annuity.
            (5) Registered index-linked annuity.--The term ``registered 
        index-linked annuity'' means an annuity--
                    (A) that is deemed to be a security;
                    (B) that is required to be registered with the 
                Commission;
                    (C) that is issued by an insurance company that is 
                subject to the supervision of the insurance 
                commissioner of the applicable State;
                    (D) that is not issued by an investment company; 
                and
                    (E) the returns of which--
                            (i) are based on the performance of a 
                        specified benchmark index or rate; and
                            (ii) may be subject to a market value 
                        adjustment if amounts are withdrawn before the 
                        end of the period during which that market 
                        value adjustment applies.
            (6) Security.--The term ``security'' has the meaning given 
        the term in section 2(a) of the Securities Act of 1933 (15 
        U.S.C. 77b(a)).
    (b) Rules.--
            (1) In general.--Not later than 180 days after the date of 
        enactment of this Act, the Commission shall propose, and, not 
        later than 18 months after the date of enactment of this Act, 
        the Commission shall prepare and finalize, new or amended 
        rules, as appropriate, to establish a new form in accordance 
        with paragraph (2) on which an issuer of a registered index-
        linked annuity may register that registered index-linked 
        annuity, subject to conditions the Commission determines 
        appropriate.
            (2) Design of form.--In developing the form to be 
        established under paragraph (1), the Commission shall--
                    (A) design the form to ensure that a purchaser 
                using the form receives the information necessary to 
                make knowledgeable decisions, taking into account--
                            (i) the availability of information;
                            (ii) the knowledge and sophistication of 
                        that class of purchasers;
                            (iii) the complexity of the registered 
                        index-linked annuity; and
                            (iv) any other factor the Commission 
                        determines appropriate;
                    (B) engage in investor testing; and
                    (C) incorporate the results of the testing required 
                under subparagraph (B) in the design of the form, with 
                the goal of ensuring that key information is conveyed 
                in terms that a purchaser is able to understand.
    (c) Treatment if Rules Not Prepared and Finalized in a Timely 
Manner.--
            (1) In general.--If, as of the date that is 18 months after 
        the date of enactment of this Act, the Commission has failed to 
        prepare and finalize the rules required under subsection 
        (b)(1), any registered index-linked annuity may be registered 
        on the form described in section 239.17b of title 17, Code of 
        Federal Regulations, or any successor regulation.
            (2) Preparation.--A registration described in paragraph (1) 
        shall be prepared pursuant to applicable provisions of the form 
        described in that paragraph.
    (d) Rules of Construction.--Nothing in this section may be 
construed to--
            (1) limit the authority of the Commission to determine the 
        information to be requested in the form described in subsection 
        (b); or
            (2) preempt any State law, regulation, rule, or order.
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