A strong 6.0% increase in direct premiums written (DPW) by the life and health industry masks a divergence in life and annuity business in 2018. While annuity premiums accelerated by 12% in 2018 after the DOL fiduciary rule was annulled, DPW of life products declined by 1.4%. A sharp increase in benefits and losses at same time, resulted in the life and health industry's pretax operating income falling by 27% in 2018. The Fed signaled that it may be willing to cut rates in response to a slowdown in growth introduced by trade tensions. We expect the Federal Reserve to cut rates in 3Q19 and one more time in early 2020. On the regulation front, a modified version of the DOL fiduciary rule was adopted in NY and the NAIC is working to introduce it in other states.