NU Online News Service, Nov. 4, 2003, 4:58 p.m. EST – Travelers Life & Annuity, Hartford, has acted on a previously announced decision to market Section 412(i) retirement plans.

CJA and Associates Inc., Chicago, an actuarial consulting firm is helping with plan design and support.

Section 412(i) of the Internal Revenue Code defines a 412(i) plan as a defined benefit retirement plan funded by fixed life insurance policies or fixed annuity contracts.

Employers can deduct contributions from taxable income, and employees can defer taxes on their share of the benefits, Travelers Life says.

Because the guaranteed rates of return on the products backing the plans are low, employers can make unusually large contributions, and the Internal Revenue Service lets the sponsor of a 412(i) plan proceed without getting an enrolled actuary to approve the level of plan assets, Travelers Life says.

The best candidates for the plans are businesses with a stable cash flow and fewer than 16 employees, Travelers Life says.

Travelers Life, a unit of Citigroup Inc., New York, is issuing the fixed products that will back the plans through its Travelers Insurance Company and Travelers Life and Annuity Company units.

Travelers Life and CJA will provide marketing support for general agents and producers as well as administrative support, Travelers Life says.