NAIFA-TX eNewsletter

Texans Pass Proposition 6!
In an overwhelming victory, Proposition 6 was approved by Texas voters in the November 6 Constitutional Amendment election. Seventy-four percent of Texas voters approved the measure, which would permanently exempt from taxation personally owned automobiles used by independent contractors for business purposes.

NAIFA-Texas played a pivotal role in supporting Proposition 6 by joining the Texans for Fair Taxation Coalition with other professional associations. "The passing of Proposition 6 represents a savings of up to $1200 per year for many NAIFA-Texas members," said NAIFA-Texas President Alan Carl, RHU, RECB, LUTCF. He added, "I hope that NAIFA-Texas members will look at the role we played in supporting Proposition 6 and know that their membership dollars are producing an incredible return on investment."

State Senator and NAIFA-Texas member Tommy Williams (R-The Woodlands) played an integral role in Proposition 6 by sponsoring the Senate Bill that helped put it on the November 6 ballot. "Senator Williams' involvement signals the importance of having lawmakers who are aware of the concerns of insurance and financial advisors in Texas," said Des Taylor, NAIFA-Texas CEO/CLO. He continued, "The value of our Political Action and Political Involvement Committees should never be underestimated, as they give us incredible resources to build relationships with lawmakers and make sure NAIFA-Texas' voice is heard in Austin."

To ensure future victories for insurance and financial advisors, please consider becoming a Texas IFAPAC contributor or increasing your current level of giving.

TDI Commissioner Issues Emergency

Rule on Medicare Advantage Plans

Texas Insurance Commissioner Mike Geeslin has issued an emergency rule that limits the marketing of Medicare Advantage plans to insurance agents holding permanent licenses. The measure comes following a meeting between Commissioner Geeslin, NAIFA-Texas President Alan Carl and several other industry leaders earlier this year. In the rule, the Commissioner cites the "increasing numbers of reports that Medicare beneficiaries of this state are being fraudulently and dishonestly deceived by licensed insurance agents into enrolling in Medicare plans that are unsuitable for those Medicare beneficiaries due to either other insurance or existing medial treatment concerns." The complaints singled out temporary agents as the greatest offenders of Medicare Advantage Plan fraud.

In response to the Commissioner's emergency rule, NAIFA-Texas President Alan Carl emphasized NAIFA's commitment to upholding the highest ethical standards for insurance agents and financial advisors across the country. "It's unfortunate that there are those who abuse the system and the people of Texas for personal gain," Carl said, " but NAIFA-Texas will always support the Commissioner in stopping unscrupulous advisors to ensure the most favorable environment for Texas consumers." Carl added, "It's our good name as insurance and financial advisors that's at stake, and that's nothing to take lightly."

To view Commissioner Mike Geeslin's emergency rule, please click here.

Update: Proposed Replacement Rules

The Texas Department of Insurance is considering changing the text of the proposed rules governing the replacement of life insurance products and annuities. The changes would allow insurers to opt to use either the notices in the published proposed rules or to use substantially similar notices that have been filed with the Department and approved by TDI Commissioner Mike Geeslin. Department staff have indicated that the basis for the Commissioner's approval would be that, in the Commissioner's opinion, the filed notice protects the rights and interests of applicants to at least the same extent as the adopted notices.

With respect to form approval, Department staff have provided the following clarification to NAIFA-Texas as follows:

Insurers using the NAIC Model Notice form are not required to file the form for approval prior to use on January 1 and thereafter.
Insurers using the NAIC Model Notice form and who add information/questions at the end of the NAIC Model Notice are not required to file the form for approval prior to us on January 1 and thereafter.
Insurers using a substantially similar notice form and who add information/questions in the "inside" or body of the NAIC Model Notice are required to file the form for approval prior to use on January 1 and thereafter. These filings will be reviewed ASAP by the Department and should be identified in the transmittal letter's subject line as "Replacement Notice Form."

A public hearing on the proposed rules will be held on November 20, and department staff urged that formal written comments be submitted prior to the hearing instead of waiting until the November 26 deadline for written comments. Please forward any concerns/suggestion you have to NAIFA-Texas CEO/CLO Des Taylor at des.taylor@naifa-texas.org.

Senate Finance Committee Considers

Federal Estate Tax Modfications

The Senate Finance Committee met on Wednesday, November 14 in a hearing entitled "Federal Estate Tax: Uncertainty in Planning Under the Current Law."

The Committee is considering revisions in the estate tax after proponents of repealing the tax were persuaded from offering amendments to a farm bill in exchange for the Finance Committee examining the issues involved in estate planning under current law.

Insurance agents and financial advisors are often at the core of professional advisors helping clients transferring business and general assets to the next generation on the most cost effective basis. Therefore, NAIFA and its members have been involved in the highly contentious estate tax debate for many years.

Wealth transfer taxes have been part of the federal tax code since 1797, and while repeal of the tax has often been discussed, it is highly unlikely. In 2006, estate and gift taxes generated $27.8 billion in federal tax revenue. Thus, lawmakers are seeking a compromise that would satisfy those advocating for the repeal of the tax, without significantly impacting a revenue stream that would threaten the current "pay as you go" budget rules adopted by Congress last January.

NAIFA has consistently supported establishing an exempt amount of approximately $3 to $3.5 million, which would be high enough to exempt 99.6% of all taxpayers from any possibility of paying estate taxes.

Leadership Development

LILI Committee Considers '08 Candidates

With the November 2 deadline now passed, the LILI selection committee is reviewing the applications of 11 candidates for the 2008 Leadership in Life Institute, beginning in Dallas in February.

The Leadership in Life Institute, NAIFA's leadership resource center, provides high caliber leaders for the NAIFA federation by fostering personal growth, enhancing business practices and developing skills necessary for effective leadership.

Using The Seven Habits of Highly Effective People by Stephen Covey, and the leadership writings of John Maxwell as primary resources, the Institute encourages participants to develop their whole selves. Participants engage in extended introspection and deal with topics such as: time management, vision and mission statements, business plans, and ways to create better, deeper relationships in every aspect of their lives, particularly family, business and association.

Results are first seen in the personal growth and heightened effectiveness of the participants. As the participants become local association leaders, local associations can expect to be more successful at reaching their local objectives. At the state and national levels, more participants will become effective and motivated state and national leaders.

The selection committee meets Friday November 16. Candidates will be notified shortly thereafter.