Life insurance groups have stepped up efforts to shape a major pension benefit bill as lawmakers set about reconciling the House and Senate versions.
The National Association of Insurance and Financial Advisors, Falls Church, Va., and the Association of Health Insurance Advisors, a NAIFA division, have sent one letter asking members of the conference committee in charge of reconciliation of the bill, H.R. 2830, to include a number of features of the bill approved by the House.
NAIFA and AHIA are supporting House bill provisions that would let agents offer investment advice to participants in defined contribution plans, let insurers sell hybrid annuities containing long term care riders, and help workers do something with cash left over in flexible spending accounts.
Because of current conflict of interest restrictions in the Employee Retirement Income Security Act, only 16% of 401(k) participants have a financial advisory service available to them through their employer-sponsored retirement plan, representatives for NAIFA and AHIA write in the letter.
The House bill would do far more to eliminate the restrictions inhibiting employers and financial advisors who are employed by the employer’s 401 (k)-plan provider from helping employees evaluate plan investment options, NAIFA and AHIA representatives write.
Meanwhile, NAIFA and an affiliate, the Association for Advanced Life Underwriting, Falls Church, Va., have joined a team that includes the National Association of Life Brokerage Agencies, Fairfax, Va., and the American Council of Life Insurers, Washington, to send the conference committee a second letter. The second letter asks the conference committee to keep a corporate-owned life insurance provision from the Senate version of the bill.
The Senate version would match the statutory rules governing COLI to industry model uses today, the authors of the second letter write.
“By limiting COLI to coverage of highly compensated employees and requiring the consent of insured individuals, this legislation will address concerns that have been expressed about some past uses,” the authors write. “Today, businesses purchase insurance on the lives of employees to meet critical needs, such as funding the cost of employee benefits and protecting against the loss of business owners or key employees. The [Senate] COLI legislation will help preserve the ability of companies to meet these needs.”
Conferees on the bill are meeting today and Thursday and hope to have a conference report ready by April 7, according to Washington Analysis, Washington.
Insurance industry lobbyists say it is unlikely that the conferees will take up the issues of interest to the insurance industry until they return March 25 from a 10-day recess.