12.09.25

FINRA Warns Against Careless 'Mid-Segment' RILA Withdrawals

by: Allison Bell

The Financial Industry Regulatory Authority (FINRA) expressed concern about consumers who give up registered index-linked annuities (RILAs) early. Savers might be able to count on getting a set amount of cash back if they keep the RILA in place until the end of the term described in the RILA contract. But, if the saver pulls cash out early, the "interim value" of the annuity might be much lower than the end-of-term value. Should an advisor tell RILA owners to make "partial withdrawals or full surrenders from RILAs 'mid-segment' without considering interim value risk," without having a "reasonable basis" for making those recommendations, the advisor could be violating the Regulation Best Interest requirements to act in the best interest of the customers, according to FINRA.

Read the full article on Think Advisor