ACLI Issues Statement to Strengthen Americans’ Retirement Security
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"The bipartisan bill would go a long way toward boosting Americans' financial security in retirement by offering greater access to annuities, the only private-sector product guaranteeing lifetime income. The bill would amend a regulation that, due to its lack of clarity, discourages employers from offering annuities in retirement plans.
"Unlike pension plans, too few 401(k) plans offer participants the opportunity to secure guaranteed income in retirement. Annuities act just like a pension in delivering income for life. Today, before an employer can offer an annuity option, the plan fiduciary must first determine whether 'an annuity provider is financially able to make all future payments under an annuity contract.' This standard is difficult for employers to meet in part because it is hard to know how to draw this conclusion.
"This bill recognizes the unique role of state insurance departments in oversight of life insurance companies, a role that includes routine reviews of the financial strength of every insurer and the insurer's ability to meet its commitments.
"With employer-based retirement savings plans playing a vital role in helping workers achieve retirement security, this legislation is absolutely necessary. By providing clear and more certain rules for the selection of an annuity provider, employers will be much more willing to offer annuities in their retirement savings plans."
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