II 

115TH CONGRESS 

1ST SESSION S. 868 

To amend the Employee Retirement Income Security Act of 1974 to require 

a lifetime income disclosure. 

IN THE SENATE OF THE UNITED STATES 

APRIL 6 (legislative day, APRIL 4), 2017 

Mr. ISAKSON (for himself and Mr. MURPHY) introduced the following bill; 

which was read twice and referred to the Committee on Health, Education, Labor, and Pensions 

A BILL 

To amend the Employee Retirement Income Security Act 

of 1974 to require a lifetime income disclosure. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Lifetime Income Dis5 closure Act’’. 

6 SEC. 2. DISCLOSURE REGARDING LIFETIME INCOME. 

7 (a) IN GENERAL.—Subparagraph (B) of section 

8 105(a)(2) of the Employee Retirement Income Security 

9 Act of 1974 (29 U.S.C. 1025(a)(2)) is amended— 

10 (1) in clause (i), by striking ‘‘and’’ at the end; 


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1 (2) in clause (ii), by striking ‘‘diversification.’’ 

2 and inserting ‘‘diversification, and’’; and 

3 (3) by inserting at the end the following: 

4 ‘‘(iii) the lifetime income disclosure 

5 described in subparagraph (D)(i). 

6 In the case of pension benefit statements de7 scribed in clause (i) of paragraph (1)(A), a life8 time income disclosure under clause (iii) of this 

9 subparagraph shall be required to be included 

10 in only one pension benefit statement during 

11 any one 12-month period.’’. 

12 (b) LIFETIME INCOME.—Paragraph (2) of section 

13 105(a) of such Act (29 U.S.C. 1025(a)) is amended by 

14 adding at the end the following new subparagraph: 

15 ‘‘(D) LIFETIME INCOME DISCLOSURE.— 

16 ‘‘(i) IN GENERAL.— 

17 ‘‘(I) DISCLOSURE.—A lifetime in18 come disclosure shall set forth the life19 time income stream equivalent of the 

20 total benefits accrued with respect to 

21 the participant or beneficiary. 

22 ‘‘(II) LIFETIME INCOME STREAM

23 EQUIVALENT OF THE TOTAL BENE24 FITS ACCRUED.—For purposes of this 

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1 come stream equivalent of the total 

2 benefits accrued’ means the amount of 

3 monthly payments the participant or 

4 beneficiary would receive if the total 

5 accrued benefits of such participant or 

6 beneficiary were used to provide life7 time income streams described in sub8 clause (III), based on assumptions 

9 specified in rules prescribed by the 

10 Secretary. 

11 ‘‘(III) LIFETIME INCOME

12 STREAMS.—The lifetime income 

13 streams described in this subclause 

14 are a qualified joint and survivor an15 nuity (as defined in section 205(d)), 

16 based on assumptions specified in 

17 rules prescribed by the Secretary, in18 cluding the assumption that the par19 ticipant or beneficiary has a spouse of 

20 equal age, and a single life annuity. 

21 Such lifetime income streams may 

22 have a term certain or other features 

23 to the extent permitted under rules 

24 prescribed by the Secretary. 


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1 ‘‘(ii) MODEL DISCLOSURE.—Not later 

2 than 1 year after the date of the enact3 ment of the Lifetime Income Disclosure 

4 Act, the Secretary shall issue a model life5 time income disclosure, written in a man6 ner so as to be understood by the average 

7 plan participant, that— 

8 ‘‘(I) explains that the lifetime in9 come stream equivalent is only pro10 vided as an illustration; 

11 ‘‘(II) explains that the actual 

12 payments under the lifetime income 

13 stream described in clause (i)(III) 

14 that may be purchased with the total 

15 benefits accrued will depend on nu16 merous factors and may vary substan17 tially from the lifetime income stream 

18 equivalent in the disclosures; 

19 ‘‘(III) explains the assumptions 

20 upon which the lifetime income stream 

21 equivalent was determined; and 

22 ‘‘(IV) provides such other similar 

23 explanations as the Secretary con24 siders appropriate. 


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1 ‘‘(iii) ASSUMPTIONS AND RULES.— 

2 Not later than 1 year after the date of the 

3 enactment of the Lifetime Income Disclo4 sure Act, the Secretary shall— 

5 ‘‘(I) prescribe assumptions that 

6 administrators of individual account 

7 plans may use in converting total ac8 crued benefits into lifetime income 

9 stream equivalents for purposes of 

10 this subparagraph; and 

11 ‘‘(II) issue interim final rules 

12 under clause (i). 

13 In prescribing assumptions under sub14 clause (I), the Secretary may prescribe a 

15 single set of specific assumptions (in which 

16 case the Secretary may issue tables or fac17 tors that facilitate such conversions), or 

18 ranges of permissible assumptions. To the 

19 extent that an accrued benefit is or may be 

20 invested in a lifetime income stream de21 scribed in clause (i)(III), the assumptions 

22 prescribed under subclause (I) shall, to the 

23 extent appropriate, permit administrators 

24 of individual account plans to use the 

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1 come stream as a lifetime income stream 

2 equivalent. 

3 ‘‘(iv) LIMITATION ON LIABILITY.—No 

4 plan fiduciary, plan sponsor, or other per5 son shall have any liability under this title 

6 solely by reason of the provision of lifetime 

7 income stream equivalents which are de8 rived in accordance with the assumptions 

9 and rules described in clause (iii) and 

10 which include the explanations contained in 

11 the model lifetime income disclosure de12 scribed in clause (ii). This clause shall 

13 apply without regard to whether the provi14 sion of such lifetime income stream equiva15 lent is required by subparagraph (B)(iii). 

16 ‘‘(v) EFFECTIVE DATE.—The require17 ment in subparagraph (B)(iii) shall apply 

18 to pension benefit statements furnished 

19 more than 12 months after the latest of 

20 the issuance by the Secretary of— 

21 ‘‘(I) interim final rules under 

22 clause (i); 

23 ‘‘(II) the model disclosure under 

24 clause (ii); or 


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1 ‘‘(III) the assumptions under 

2 clause (iii).’’. 

Æ 


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