Regulation BI is the full name of the SEC's Regulation Best Interest, which sets a heightened standard of conduct for broker-dealers and their associated persons when they make recommendations to retail investors. Regulation BI requires firms to act in the retail customers best interest and addresses disclosure of capacity and conflicts, care obligations, policies to mitigate conflicts of interest, and overarching compliance responsibilities. The rule covers recommendations of securities, including variable annuities and registered index-linked annuities, and interacts with other disclosure regulations such as Form CRS. In many insurance-focused firms, Regulation BI sits alongside state best-interest rules to shape how complex products are sold and supervised.

Operationally, many firms refer interchangeably to "Reg BI" and "Regulation BI" when discussing policy updates, compliance audits, and advisor training. Written supervisory procedures detail how Regulation BI is implemented through fact-finding, product comparison, documentation templates, and post-sale reviews. Advisors must demonstrate that they have considered reasonably available alternatives and that compensation structures do not improperly bias recommendations. Regulators examine firms' Regulation BI frameworks during exams, reviewing samples of variable annuity and RILA recommendations. Advisors who understand Regulation BI can better explain to clients why they ask so many questions, provide detailed disclosures, and maintain extensive documentation in the sales process.