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Annuity Training Requirements

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SPECIAL BULLETIN: New Training Requirements for New Jersey Insurance Agent

New Jersey insurance agents who sell annuities now have new training requirements to follow. On April 21, 2025, the New Jersey Department of Banking and Insurance adopted updated rules that align with the 2020 revisions to the NAIC Suitability in Annuity Transactions Model Regulation. These changes apply to producers licensed before and after the effective date and must be completed within specific timeframes.

At BetterCE, we want producers to have a clear understanding of what is changing, who is affected, and how to stay compliant. This article breaks down the updates and explains how our state-approved courses can help agents meet the requirements on time.

What Is the Best Interest Standard?

The biggest change centers around the Best Interest Standard. Agents must act in the consumer’s best interest when recommending annuity products. Agents should follow specific steps to ensure their recommendations are based on the customer’s needs, not financial incentives.

The Best Interest Standard includes four main duties:

  • Care
  • Disclosure
  • Conflict of interest management
  • Documentation

Producers must gather information about the client’s financial goals and insurance needs. They must explain how the recommended product addresses those goals. They must also disclose how they are compensated and document the recommendation properly.  

People studying at table with laptops- quote from text about new training requirements for New Jersey insurance agents.

Who Needs to Complete Training?

Every producer who wants to sell annuity products in New Jersey must complete training that reflects the new standard. However, the specific course depends on when the agent was licensed.

Agents Licensed Before April 21, 2025

If you were licensed before the new rules took effect and completed the older 4-hour annuity training course, you still need to take additional training. A one-time 1-hour course is required to update your knowledge with the Best Interest Standard. This course must be completed by October 21, 2025.

Agents Licensed on or After April 21, 2025

If you were licensed on or after April 21, 2025, you must complete a full 4-hour annuity training course that includes the Best Interest framework. You must complete this course before recommending or selling any annuity products.

Important Deadlines to Know

Missing a training deadline could delay or prevent you from selling annuities. These are the key dates all producers should keep in mind:

  • April 21, 2025: New requirements officially take effect
  • April 28, 2025: Old annuity courses will no longer be accepted for approval
  • October 21, 2025: Final deadline to complete the 1-hour course for previously licensed agents
  • October 31, 2025: Last day for providers to report completions for the 1-hour course

Four important deadlines for New Jersey insurance agents.

Two Training Paths Available Through BetterCE

We offer both of the required training options through our online course platform. Each course is approved by the New Jersey Department of Banking and Insurance and designed to help agents stay on track.

4-Hour Training Course

This course is required for agents licensed on or after April 21, 2025. It includes a complete overview of annuity product types, consumer profile evaluations, ethical sales practices, and the Best Interest Standard. By the end of the course, students should feel confident navigating the new rules and making compliant product recommendations.

Our course is self-paced, text-based, and available online at any time. Once the course is completed, we report your credits directly to the state.

1-Hour Refresher Course

If you have already completed the old 4-hour annuity course, you only need to take this 1-hour refresher. It focuses on the new Best Interest Standard and covers updates to disclosure practices, sales conduct, and documentation rules.

Topics in this course include:

  • Ethical product recommendations
  • Consumer protections in annuity sales
  • Updates to required disclosure forms
  • State Guarantee Fund considerations

This course also meets the NAIC Annuity Suitability Training Requirement for New Jersey. Like our 4-hour course, it is fully online and self-paced.  

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Key Terms You Should Understand

There are a few terms that agents should recognize when reviewing the training requirements:

  • Best Interest Standard: A rule requiring producers to base their recommendations on what is best for the consumer. It includes care, disclosure, conflict of interest management, and documentation.
  • Consumer Profile Information: The data producers must collect from clients, such as income, age, financial goals, and risk tolerance.
  • Producer Disclosure Form: A state-required form that outlines the agent’s role, compensation, and which insurers they represent.

Complete Your Training With Confidence

Now is the right time to ensure you’re compliant. Whether you need the full 4-hour course or just the 1-hour refresher, we have you covered.

Explore our New Jersey training catalog today and take the first step toward protecting your license, your clients, and your reputation.

At BetterCE, we make continuing education easy, reliable, and accessible for every insurance professional.

Two people reviewing documents- Understanding Changes to Annuity Training Requirements: From Suitability to Best Interest Standard.

Understanding Changes to Annuity Training Requirements: From Suitability to Best Interest

In recent years, the financial services industry has undergone significant regulatory changes aimed at better-protecting consumers. These changes particularly impact how annuities are sold, shifting from a “suitability” standard to a “best interest” standard. This evolution prioritizes the client’s financial well-being over the advisor’s incentives. Let’s explore what this shift means for financial professionals and consumers, and how updated annuity training requirements align with this new approach.

The Traditional Suitability Standard: What It Was and Why It Changed

Historically, financial advisors recommend annuities operated under the “suitability” standard. This framework required advisors to ensure that the products they recommended were suitable for the client based on factors like age, income, and financial goals. However, the suitability standard did not compel advisors to prioritize the client’s best interests.

For example, an advisor might have recommended an annuity that offered higher commissions, even if a different product better suited the client’s long-term needs. While the suitability rule avoided overtly inappropriate recommendations, it left room for choices driven by the advisor’s financial interests rather than the client’s best outcomes. This limitation prompted regulators to implement the best interest standard.  

Under the Best Interest Standard, advisors must advise in three ways which are listed.

What Is the Best Interest Standard?

The “best interest” standard raises the bar by requiring advisors to recommend annuity products that align closely with the client’s unique financial situation. Unlike the suitability rule, this approach mandates that advisors act in the client’s best interest, prioritizing their needs above personal or financial incentives.

Under this standard, advisors must:

  • Conduct a comprehensive analysis of the client’s financial goals and risk tolerance.
  • Recommend products that provide the most appropriate solution based on the client’s needs.
  • Ensure their advice is unbiased and not influenced by commissions or other incentives.

This shift places consumers at the forefront of financial planning, fostering transparency and trust.

Key Changes in Annuity Training Requirements

To align with the best interest standard, annuity training requirements have been significantly updated. Financial professionals must now complete specialized training that equips them to navigate this new regulatory framework. Below are the key areas of focus:

1. Comprehensive Product Understanding

Advisors are required to develop a deep understanding of the annuity products they recommend, including:

  • Features and benefits.
  • Associated risks and costs.
  • Suitability for various client profiles.

This ensures advisors can provide well-informed recommendations tailored to their clients.

2. Consumer Needs Analysis

Training emphasizes conducting thorough evaluations of clients’ financial situations. Advisors learn how to:

  • Assess financial goals and income needs.
  • Determine risk tolerance and investment time horizons.
  • Match clients with the most appropriate annuity products.

3. Ethical Decision-Making

Advisors must adhere to enhanced ethical standards, acting as fiduciaries by:

  • Prioritizing the client’s interests above all else.
  • Avoiding conflicts of interest.
  • Disclosing any incentives that might influence their recommendations.

4. Regulatory Compliance

The updated training ensures advisors stay compliant with regulations from bodies such as:

  • The Department of Labor (DOL).
  • The Securities and Exchange Commission (SEC).

This compliance minimizes risks for both advisors and clients.

5. Transparency Through Disclosure

Advisors must provide clients with clear, detailed information about:

  • Product costs and benefits.
  • Potential risks associated with the recommended annuity.
  • Any conflicts of interest tied to the recommendation.

Female working at desk writing on document- Five key changes in Annuity training.

What These Changes Mean for Financial Advisors

The transition to the best interest standard presents both challenges and opportunities for financial professionals.

Challenges:

  • Advisors must invest time and resources in completing updated training programs.
  • Staying current with evolving regulations requires ongoing education and diligence.

Opportunities:

  • Advisors can build stronger, trust-based relationships with clients.
  • Acting in the client’s best interest can differentiate advisors in a competitive market.
  • Enhanced ethical practices position advisors as credible, client-focused professionals.

By embracing these changes, financial professionals can reinforce their commitment to ethical practices and long-term client success.

How Consumers Benefit from the Best Interest Standard

For consumers, the shift from suitability to best interest represents a win. Key benefits include:

  • Greater Transparency: Advisors must disclose detailed information, helping clients make informed decisions.
  • Better Alignment: Recommendations are more likely to match the client’s financial goals and circumstances.
  • Improved Trust: Knowing their advisor acts in their best interest fosters confidence in financial decisions.

Ultimately, this regulatory shift empowers consumers to achieve better financial outcomes and avoid products that might not meet their needs.  

Three ways consumers benefit from the Best Interest Standard.

A New Era of Consumer-Centered Financial Planning

The evolution from suitability to best interest in annuity training requirements reflects a broader commitment to consumer protection and ethical financial practices. By adopting this higher standard, financial professionals can better serve their clients while adhering to modern compliance requirements. For consumers, this means greater confidence, transparency, and trust in their financial planning journey.

As the financial services industry continues to evolve, staying informed and compliant with these changes is crucial for success. Advisors who embrace the best interest standard will not only meet regulatory requirements but also strengthen their relationships with clients, ensuring long-term growth and credibility.