II 

111TH CONGRESS 

1ST SESSION S. 2832 

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

a lifetime income disclosure. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 3, 2009 

Mr. BINGAMAN (for himself, Mr. ISAKSON, and Mr. KOHL) 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 only be required to be in10 cluded in one pension benefit statement in each 

11 calendar year.’’. 

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 an19 nuity equivalent of the total benefits 

20 accrued with respect to the partici21 pant or beneficiary. 

22 ‘‘(II) ANNUITY EQUIVALENT OF

23 THE TOTAL BENEFITS ACCRUED.— 

24 For purposes of this subparagraph, 

25 the ‘annuity equivalent of the total 


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1 benefits accrued’ means the amount of 

2 monthly payments the participant or 

3 beneficiary would receive at the plan’s 

4 normal retirement age if the total ac5 crued benefits of such participant or 

6 beneficiary were used on the date of 

7 the lifetime income disclosure to pur8 chase the life annuities described in 

9 subclause (III), with payments under 

10 such annuities commencing at the 

11 plan’s normal retirement age. 

12 ‘‘(III) LIFE ANNUITIES.—The 

13 life annuities described in this sub14 clause are a qualified joint and sur15 vivor annuity (as defined in section 

16 205(d)), based on assumptions speci17 fied in rules prescribed by the Sec18 retary, including the assumption that 

19 the participant or beneficiary has a 

20 spouse of equal age, and a single life 

21 annuity. Such annuities may have a 

22 term certain or other features to the 

23 extent permitted under rules pre24 scribed 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 annuity 

9 equivalent is only provided as an illus10 tration; 

11 ‘‘(II) explains that the actual an12 nuity payments that may be pur13 chased with the total benefits accrued 

14 will depend on numerous factors and 

15 may vary substantially from the annu16 ity equivalent in the disclosures; 

17 ‘‘(III) explains the assumptions 

18 upon which the annuity equivalent 

19 was determined; and 

20 ‘‘(IV) provides such other similar 

21 explanations as the Secretary con22 siders appropriate. 

23 ‘‘(iii) ASSUMPTIONS AND RULES.— 

24 Not later than 1 year after the date of the 


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1 enactment of the Lifetime Income Disclo2 sure Act, the Secretary shall— 

3 ‘‘(I) prescribe assumptions that 

4 administrators of individual account 

5 plans may use in converting total ac6 crued benefits into annuity equiva7 lents for purposes of this subpara8 graph; and 

9 ‘‘(II) issue interim final rules 

10 under clause (i). 

11 In prescribing assumptions under sub12 clause (I), the Secretary may prescribe a 

13 single set of specific assumptions (in which 

14 case the Secretary may issue tables or fac15 tors that facilitate such conversions), or 

16 ranges of permissible assumptions. To the 

17 extent that an accrued benefit is or may be 

18 invested in an annuity contract, the as19 sumptions prescribed under subclause (I) 

20 shall, to the extent appropriate, permit ad21 ministrators of individual account plans to 

22 use the amounts payable under such con23 tract as an annuity equivalent. 

24 ‘‘(iv) LIMITATION ON LIABILITY.—No 

25 plan fiduciary, plan sponsor, or other perVerDate Nov 24 2008 04:23 Dec 04, 2009 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2832.IS S2832

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1 son shall have any liability under this title 

2 solely by reason of the provision of annuity 

3 equivalents which are derived in accord4 ance with the assumptions and rules de5 scribed in clause (iii) and which include the 

6 explanations contained in the model life7 time income disclosure described in clause 

8 (ii). This clause shall apply without regard 

9 to whether the provision of such annuity 

10 equivalent is required by subparagraph 

11 (B)(iii). 

12 ‘‘(v) EFFECTIVE DATE.—The require13 ment in subparagraph (B)(iii) shall apply 

14 to pension benefit statements furnished 

15 more than 12 months after the latest of 

16 the issuance by the Secretary of— 

17 ‘‘(I) interim final rules under 

18 clause (i); 

19 ‘‘(II) the model disclosure under 

20 clause (ii); or 

21 ‘‘(III) the assumptions under 

22 clause (iii).’’. 

Æ 


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