News | 01.08.20
What the SECURE Act Means for Annuities
Kathleen Coulombe, vice president of retirement security and federal relations at the American Council of Life Insurers, said the SECURE Act makes it easier for employers to offer annuities with lifetime guaranteed income streams within their retirement plans. That's sometimes been a controversial topic. “At present, employers must either hire a costly financial expert to audit an annuity provider's books or figure out for themselves whether an insurer can deliver on its promises,” Coulombe says. “What's new in SECURE is that employers will be able to rely on the experts—i.e., state insurance departments—to ensure that life insurers will be there now and in the future.” Elsewhere, the SECURE Act extends “safe harbor” protections for plan sponsors when they select annuities, reducing their potential liability even if the insurer defaults. Furthermore, the law doesn't require workers to choose the products.
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