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SEC Proposes Simplified Disclosure Document for Variable Products

The SEC released a proposal designed to improve and simplify disclosures about variable annuities and variable life insurance contracts.  The proposed summary prospectus aims to help investors better understand the features, fees, and risks of variable annuities and to make investment information easier to find, the SEC said. The proposal would permit these contracts to use a summary prospectus to provide “a concise, reader‑friendly summary of key facts about the contract” with additional information available online. Investors may opt to have the additional information delivered to them at no cost in paper or electronically. Mutual funds since 2009 have been permitted to use summary prospectuses. The SEC has asked for public comment on the proposal, as well as on hypothetical summary prospectus samples it has published.