Lifetime Income For Employees Act

Bill: 116-hr-8990
Sponsor: full_name: Rep. Norcross, Donald [D-NJ-1]
Introduced: 2020-12-16
Policy area: Labor and Employment
Latest action: action_date: 2020-12-16
text: Referred to the House Committee on Education and Labor.

Summaries:
action_date: 2020-12-16
action_desc: Introduced in House
text: <p><b>Lifetime Income For Employees Act</b><br> <br> 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.</p>

tv_txt: I 116th CONGRESS 2d Session H. R. 8990 IN THE HOUSE OF REPRESENTATIVES December 16, 2020 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.

1. Short title This Act may be cited as the Lifetime Income For Employees Act . 2. Default investment in annuity contracts 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), by adding at the end the following: Default investments made under this subparagraph may include a covered annuity contract. ; and (2) by adding at the end the following: (C) Covered annuity contract (i) In general 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 not later than 30 days before the date of the imposition of a liquidity restriction described in subclause (I) written notice in a manner that is reasonably designed to be understood by the average plan participant, 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 or electronically, about their investment alternatives; and (ee) a copy of the annuity contract. (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) Definition of annuity contract For purposes of this paragraph, 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. (D) Effective date The amendments made by subsection (a) shall take effect on the date of the enactment of the Lifetime Income For Employees Act . .