The final shape of the U.S. Department of Labor’s proposal to apply a fiduciary standard to retirement plan advice is due out soon, and the brokerage industry and others are bracing for its impact.

But some people posit the rule will spur product and platform innovation in the U.S. wealth management business, and Cerulli Associates is among that group. In a new research report, the Boston-based financial services analytics firm said the DOL’s proposal––which seeks to eliminate conflicts of interest in retirement plan advice––will likely lead lead to new technology and products enabling brokerages to serve smaller retirement accounts on a flat-fee basis.

The DOL’s proposal would apply a fiduciary standard to all financial advisors providing investment advice for a fee to a retirement account plan or participant. The brokerage and insurance industries say the DOL’s efforts to redefine investment advice under the Employee Retirement Income Security Act of 1974, or ERISA, will subject their member firms, many of whom abide by the suitability standard, to a fiduciary standard that will add compliance costs making it too costly to provide advice to retirement plans with small accounts.

The DOL wouldn’t ban current compensation arrangements such as commissions, trailing commissions, 12b-1 fees and the like––i.e., sales practices that are considered conflicted and are no-nos under ERISA––as long as firms provide clients with a Best Interest Contract Exemption (BICE).

Among other features, this contract would require the advisor and financial institution to contractually acknowledge fiduciary status; commit to adhere to basic standards of impartial conduct; warrant that they have adopted policies and procedures reasonably designed to mitigate any harmful impact of conflicts of interest; and disclose any potential conflicts of interest pertaining to compensation and other fees.

In addition, firms relying on the exemption would have to notify the DOL in advance of doing so, and would have to maintain certain data––and make it available to the DOL–– to help evaluate the effectiveness of the exemption in protecting the interests of the plan participants and beneficiaries, IRA owners, and small plans.

The brokerage and insurance industries maintain that all of these BICE demands would make it too burdensome and expensive to service small retirement plans. The end result would be countless investors without professional advice on their retirement savings, they say.

Ultimately, says Cerulli, the wealth management industry will adjust, and in doing so will change the way business is done.

Bing Waldert, managing director at Cerulli, notes that the impact of the DOL’s proposed conflict of interest rule may not be immediately felt but will eventually lead to a period of product and platform innovation at broker-dealers and product manufacturers.

“Cerulli expects there will be unexpected changes to the retirement and wealth management industries, and, to a degree, this cultural evolution is what the proposed rule is hoping to effect,” Waldert wrote in the first quarter 2016 issue of The Cerulli Edge – Retirement Edition report.