By John Hilton
May 14, 2019
As a pair of
retirement security bills advance through Congress, optimism is growing that a
bipartisan agreement could be in the offing.
The Senate Finance
Committee is holding a hearing this morning on “Challenges in the Retirement
System.”
Last month, the
committee chairman, Sen. Chuck Grassley, R-Iowa, and ranking member, Sen. Ron
Wyden, D-Ore., introduced the Retirement Enhancement and Savings Act (RESA).
The bill is similar to a House bill, the Setting Every Community Up for
Retirement Enhancement Act of 2019, or SECURE Act, that unanimously passed out
of the House Way and Means committee last month.
The House is
expected to vote on the SECURE Act before a Memorial Day recess period.
The bills contain a
number of measures, from boosting the use of annuities to permitting small
employers to team up on retirement plans – known as Multi-Employer Plans, or
MEPs.
Industry trade groups are enthusiastically backing both bills.
Industry trade groups are enthusiastically backing both bills.
The Insured
Retirement Institute submitted a written statement to the Finance Committee
expressing strong support for RESA and urging senators to quickly advance the
measure and then begin working with the House to approve a final version for
the president’s signature.
“The House and
Senate legislation are close to identical and both chambers would likely need
only a short time to work together to resolve their differences and finalize a
bill for the president,” said Wayne Chopus, IRI president and CEO.
Meanwhile, members
from the National Association of Insurance and Financial Advisors are in Washington, D.C. today urging
Congress to enact the SECURE Act.
Not
Much Of An Opportunity
Insurance
executives fielded questions on the proposed changes during first quarter
earnings calls with Wall Street analysts. Some were eager to see passage of the
legislation and expanded markets for annuities.
“We really believe
that it's in the best interest of Americans to have this kind of income
guarantee available to them moving forward,” said Renee Schaaf, president of
retirement and income solutions for Principle Financial. “We're excited not
only about the open MEPs, but also about the ability to provide that higher
through retirement solution to the U.S. worker.”
Other executives
are unsure about the potential impact on their businesses. John Matovina,
president and CEO of American Equity, questioned whether the changes will accommodate
prominent annuity features.
“One of the key
elements of an accumulation annuity is the surrender charge period, which
facilitates our investment horizon,” he explained. “And if they're going to
allow that type of approach in those plans, there's perhaps an opportunity
there.
“But if they're
going to look for annuity products and annuities that have a similar-type
liquidity features as do the securities and mutual funds that are already in
retirement plans, I just don't view that as much of an opportunity.”
InsuranceNewsNet
Senior Editor John Hilton has covered business and other beats in more than 20
years of daily journalism. John may be reached at john.hilton@innfeedback.com.
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