Will concerns hamper guaranteed annuity use in retirement plans?
February 7, 2013 by Elizabeth Festa
A new study embraces guaranteed lifetime income annuities within employer-provided plans as a way to fortify with retirement security, but acknowledges severe regulatory impediments, which both the life insurance industry and the NAIC are striving to overcome with regulatory and legislative action.
The report, released by the Insured Retirement Institute (IRI) this week, found that workers who convert a portion of their accumulated assets into a guaranteed income stream can effectively manage many of the risks inherent to the defined contribution retirement system such as longevity risk, volatility and sequence of returns risk, as well as excess withdrawal risk.
The Guaranteed Lifetime Income Options within Employment-Based Plans report said research by IRI shows baby boomers value guarantees, and the value to a person of those guarantees increases with a person’s age, the IRI said.
