New Federal Proposals Will Make Annuities More Available To Workers

February 6, 2012 by N/A

WASHINGTON, Feb. 2 — The American Council of Life
Insurers issued the following news release:

American workers will be better able to access annuities and address their
lifetime retirement security needs under a series of steps taken today by the
U.S. Treasury and Labor Departments, said the American Council of Life Insurers
(ACLI).

Treasury’s actions will make it easier for workers participating in
employer-sponsored retirement plans to use a portion of their savings to
acquire an annuity that offers guaranteed income for life. Treasury would
eliminate some of the burdens that discouraged retirement plans from offering
annuity options to participants.

“Treasury has advanced a major plan to address our nation’s retirement
income crisis. Millions of American workers are not prepared for the challenge
of managing assets through a lengthy retirement. They face a real risk of
outliving their assets, possibly facing economic hardship at one of the most
vulnerable stages of their lives. Helping today’s workers achieve lifetime
retirement income can help avert a crisis in the years ahead, when much of the baby
boom generation will leave the workforce,” said ACLI President and CEO
Dirk Kempthorne.

Today’s actions follow a Treasury-Labor Department “Request for
Information” published in 2010 on ways to encourage lifetime retirement
income options.

ACLI’s response focused on the unnecessary administrative burdens faced by
retirement plans that want to offer annuity options to participants.

“Treasury wisely recognized the need to help people secure a stream of
income they could not outlive. We are gratified that Treasury responded to many
of our suggestions. Our common goal should be to help assure the financial
security of American workers throughout their retirement years,”
Kempthorne said.

Also, the Labor Department today issued a final rule that will enhance
disclosure of the benefits offered and the fees charged by retirement plan
service providers.

Under the DOL rule, employers will receive information from service providers
under uniform rules for describing the costs and benefits of plan products and services.
The rule takes effect July 1.

“Life insurance companies provide outstanding service and excellent value
to retirement plans. We hope the new rule will help employers recognize the
benefits life insurers can offer plans,” he said.

Information about the steps taken today can be found at:

Treasury Release http://www.treasury.gov/press-center/press-releases/Pages/tg1407.aspx

Treasury Fact Sheet http://www.treasury.gov/press-center/press-releases/Documents/020212%20Retirement%20Security%20Factsheet.pdf

White House Council of Economic Advisors Reporthttp://www.whitehouse.gov/sites/default/files/cea_retirement_report_01312012_final.pdf

TNS CT21CT-120203-3762596 61ChengTacorda

Originally Posted at InsuranceNewsNet on February 4, 2012 by N/A.