Title: Lifetime Income For Employees Act
Policy area: Labor and Employment

Summary:
Lifetime Income For Employees Act  This bill allows fiduciaries of pension plans to make default investment arrangements in annuity contracts upon providing certain notice to plan participants or beneficiaries and complying with certain prohibitions on liquidity restrictions.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6746 Introduced in House (IH)]

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117th CONGRESS
  2d Session
                                H. R. 6746

To amend the Employee Retirement Income Security Act of 1974 to permit 
 default investment arrangements in annuities, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           February 15, 2022

  Mr. Norcross (for himself and Mr. Walberg) introduced the following 
    bill; which was referred to the Committee on Education and Labor

_______________________________________________________________________

                                 A BILL


 
To amend the Employee Retirement Income Security Act of 1974 to permit 
 default investment arrangements in annuities, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Lifetime Income For Employees Act''.

SEC. 2. DEFAULT INVESTMENT IN ANNUITY CONTRACTS.

    (a) In General.--Section 404(c)(5) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1104(c)(5)) is amended--
            (1) in subparagraph (A)--
                    (A) by inserting ``or subparagraph (C), as 
                appropriate,'' after ``subparagraph (B)''; and
                    (B) by inserting ``or in a covered annuity 
                contract.'' after ``by the Secretary''; and
            (2) by adding at the end the following:
                    ``(C) Covered annuity contract.--
                            ``(i) In general.--For purposes of this 
                        paragraph, the term `covered annuity contract' 
                        means an investment in an annuity contract that 
                        meets the following requirements:
                                    ``(I) The annuity contract does not 
                                impose a liquidity restriction on the 
                                transfer of invested amounts during the 
                                180-day period beginning on the date of 
                                the initial investment in such contract 
                                by the participant or beneficiary.
                                    ``(II) The fiduciary ensures that 
                                each participant or beneficiary is 
                                provided notice in writing in 
                                accordance with clause (ii).
                                    ``(III) The fiduciary allocates not 
                                more than 50 percent of any periodic 
                                contribution or, immediately after a 
                                rebalancing of account investments, 50 
                                percent of the value of the assets of 
                                the account, to the annuity contract 
                                (or, as applicable, to the portion 
                                thereof to which a liquidity 
                                restriction applies after the 180-day 
                                period in subclause (I)).
                            ``(ii) Notice requirement.--For the 
                        purposes of this subparagraph, each participant 
                        or beneficiary shall be provided notice in 
                        writing in a manner that is reasonably designed 
                        to be understood by the average plan 
                        participant, as follows:
                                    ``(I) Not later than 30 days in 
                                advance of the initial investment, a 
                                notice that includes--
                                            ``(aa) an explanation of 
                                        the circumstances under which 
                                        assets in the account may be 
                                        invested on behalf of the 
                                        participant or beneficiary in 
                                        the annuity contract, including 
                                        an explanation of the targeted 
                                        range and maximum amount or 
                                        percentage of such assets to be 
                                        invested;
                                            ``(bb) an explanation of 
                                        the rights, and any limitations 
                                        or restrictions thereon, of a 
                                        participant or beneficiary to 
                                        direct or transfer amounts 
                                        invested, or to be invested, in 
                                        an annuity contract to other 
                                        investment alternatives 
                                        available under the plan;
                                            ``(cc) a general 
                                        description of the annuity 
                                        contract, including the 
                                        duration of guaranteed payments 
                                        and identification of the 
                                        insurer;
                                            ``(dd) an explanation of 
                                        how a participant or 
                                        beneficiary may obtain 
                                        additional information in 
                                        writing about their investment 
                                        alternatives; and
                                            ``(ee) a description of how 
                                        to obtain a copy of the annuity 
                                        contract.
                                    ``(II) Not later than 30 days 
                                before the date of the imposition of a 
                                liquidity restriction described in 
                                subclause (i)(I), that includes--
                                            ``(aa) a statement 
                                        explaining that the 
                                        participant's or beneficiaries' 
                                        contributions will shortly 
                                        become subject to liquidity 
                                        restrictions;
                                            ``(bb) an explanation of 
                                        the rights of the participant 
                                        or beneficiary to direct or 
                                        transfer amounts to be invested 
                                        in alternatives under the plan; 
                                        and
                                            ``(cc) an explanation of 
                                        how a participant or 
                                        beneficiary may obtain 
                                        additional information about 
                                        their investment alternatives.
                            ``(iii) Definition of annuity contract.--
                        For purposes of this subparagraph, the term 
                        `annuity contract' means a contract (or 
                        provision or feature thereof) that--
                                    ``(I) is issued by an insurer 
                                qualified to do business in a State; 
                                and
                                    ``(II) provides for the payment of 
                                guaranteed benefits annually (or more 
                                frequently) for a fixed term or for the 
                                remainder of the life of the 
                                participant or beneficiary or the joint 
                                lives of the participant and the 
                                participant's designated 
                                beneficiary.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply with respect to investments made on or after the date of 
enactment of this Act.
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