From: Kevin Hanney [mailto:kthanney@gmail.com] 

Sent: Monday, August 16, 2010 3:30 PM 

To: EBSA, E-ORI - EBSA 

Subject: Lifetime Income Joint Hearing

Ms. Borzi, Ms. Marks and Mr. Iwry, 

 

I wish to submit my request to present testimony at the joint Hearing on Certain Issues 

Relating to Lifetime Income Options for Participants and Beneficiaries in Retirement 

Plans on September 14, 2010. I believe I am qualified to present valuable testimony in 

my capacity as an investment professional who is responsible for the oversight of 

pensions both here in the U.S. and abroad. Among my qualifications, I have over 16 

years of experience in the investment industry and hold the Chartered Financial Analyst 

Designation. I am employed by United Technologies Corporation, a large multi-national 

organization based in the Northeastern U.S. My professional responsibilities include 

oversight of the investment and funding aspects of defined contribution and defined 

benefit plans with over 150,000 participants and assets in excess of US$15 Billion. I 

have closely studied lifetime income alternatives for potential adoption in employersponsored plans for the last 4 years. 

 

I should note that while I employed by United Technologies Corporation, I wish to 

present testimony as an individual. The views I would express are my own and should 

not be construed to represent the views of my employer or any professional organizations 

with which I am affiliated. That said, I have the opportunity to frequently interact with 

many people in my field as we actively consider issues related to retirement plans and 

lifetime income and I believe my views are not unique within the plan sponsor 

community. 

 

Specifically, I wish to address the following issues included in your announcement 

regarding the hearing: 1. Participant Concerns Affecting the Choice of Lifetime Income 

Relative to Other Options, 4. Fiduciary Safe Harbor for Selection of Lifetime Income 

Issuer or Product, and 5. Alternative Designs of In-Plan and Distribution Lifetime Income 

Options. However, I understand the time constraints of this hearing and would ask that I 

be allowed to present testimony on the latter two issues (#4 & #5) if it is necessary to 

limit my comments. 

 

The following brief outline encapsulates the points I wish to make on each issue: 

I. Participant Concerns Affecting Choice of Lifetime Income (3-5 minutes, 2 PowerPoint 

slides with written speaking notes) 

A. Evidence of participant inertia in employer-sponsored plans 

B. Potential impact of inflation on fixed benefit streams of income 

C. Comparison of costs, benefits and risks associated with retirement income approaches 

 

II. Fiduciary Safe Harbor for Selection (3-5 minutes, 2 PowerPoint slides with written 

speaking notes) 
A. Ambiguity in current guidance 

B. Clarification of products covered & implications of the state guaranty system 

C. Minimum standard of care for selection, monitoring & replacement 

 

III. Alternative Designs of In-Plan & Distribution Options (3-5 minutes, 3 PowerPoint 

slides with written speaking notes) 

A. Traditional Immediate Fixed Annuities versus Living Benefits such as GLWBs 

B. Opportunities for use of TreasuryDIRECT system in DC plans & IRAs 

C. Recommendation for new debt issuance specifically for US-based investors 

 

Thank you for your consideration. 

 

Sincerely, 

 

Kevin T. Hanney, CFA 

12 Crosby Road 

North Salem, NY 10560 

(914) 216-5131