Retirement Plans Executive Summit Retirement Plans Executive Summit

Retirement Plans Executive Summit

Retirement Plans Executive Summit In-Plan Annuities: Working together to build support among plan sponsors and policymakers Lee Covington Senior Vice President & General Counsel Insured Retirement Institute

Top Public Policy Issues • Increasing Access to In-Plan Annuity Options • • Lifetime Income Illustrations Annuity Selection Safe Harbor Annuity Portability Treasury Rules—QLAC • Congressional Retirement Reform Proposals Retirement Plans Executive Summit

Increasing Access to In-Plan Annuities • President’s Middle Class Task Force: Promoting the availability of annuities and other forms of guaranteed lifetime income, which transform savings into guaranteed future income, reducing the risks that retirees will outlive their savings or that their retirees’ living standards will be eroded by investment losses or inflation. • Treasury/DOL initiative to make lifetime income options more broadly available in retirement plans Retirement Plans Executive Summit

Increasing Access to In-Plan Annuities • Qualifying Longevity Annuity Contract (QLAC) Rule • Removes longevity annuities from Required Minimum Distribution (RMD) rules • Adopted as of July 1, 2014 Retirement Plans Executive Summit

Lifetime Income Illustrations • Background • DOL Advance Notice of Proposed Rulemaking (draft rule) (May 2013) • IRI comment letter supporting the draft rule and providing some suggestions about how to develop and implement • LIDA also re-introduced in the House in May 2013 and in the Senate in June 2013. • IRI Research Supporting Mandatory Illustrations on Workers’ Account Statements—Provided to DOL • Current Congressional Proposals (S. 1317/H. R. 2317) Retirement Plans Executive Summit

Increasing Access to In-Plan Annuities • DOL Safe Harbor for Selection and Monitoring of Annuity Providers • Fiduciary concerns are the most significant obstacle to more widespread inclusion • DOL / Treasury views and activities • Congressional proposal relies on state regulation • Annuity Portability—Action by Congress Required Retirement Plans Executive Summit

Retirement Reform Proposals • Secure Annuities for Employees (SAFE) Retirement Act (S. 1270) • • • Annuity Provider Selection and Monitoring Safe Harbor Annuity Portability through Distributable Event Increases Auto Enrollment Default to 6% Removes 10% Cap on Auto Escalation Senate Finance Chairman Hatch (R-UT) Retirement Plans Executive Summit

Retirement Reform Proposals • Retirement Security Act (S. 266/H. R. 557) • Permits Open MEPs • Senate Special Committee on Aging Chairwoman Susan Collins (R-ME) & Sen. Bill Nelson (D-FL); Rep. Vern Buchanan (R-FL) & Rep. Ron Kind (D-WI) • Senate Finance Committee Saving and Investment WG Report • Receiving Electronic Statements to Improve Retiree Earnings (RETIRE) Act (H. R. 2656) • Reps. Polis (D-CO), Roe (R-TN), Kind (D-WI), Kelly (R-PA) • Bipartisan effort Retirement Plans Executive Summit

Retirement Reform Proposals • Automatic IRA Act of 2015 (H. R. 506 / S. 245) • Mandates that Employers Auto-Enroll Employees in a 401 K Plan • Administration Request for Industry Support • Rep. Neal (D-MA); Sen. Whitehouse (D-RI) Retirement Plans Executive Summit

QUESTIONS? Lee Covington Senior Vice President & General Counsel Insured Retirement Institute Email: lcovington@irionline. org Phone: 202 -469 -3002 Retirement Plans Executive Summit