Efforts by the Senate Republican leadership to slip estate tax reform into the pending pension reform bill has the insurance industry concerned that the political weight could sink the entire ship.
Insurance industry officials are anxious for passage of the defined benefit pension overhaul bill because it also has defined contribution provisions attached to it that could provide a whole array of new products for the industry to sell.
Timing is critical because pressure is mounting on Congress to act on pension reform and accompanying legislation before Congress departs for the July 4 recess on June 28. Still, much work remains to be done.
“With the full support of House and Senate leadership to resolve the remaining differences in the pension legislation, we are optimistic that agreements can be reached on all key issues prior to the July 4 recess,” said Kenneth Cohen, senior vice president and deputy general counsel, Massachusetts Mutual Life Insurance Company. “Pension issues have taken months to resolve. Adding additional controversial issues to the package could kill the chances for enactment this year.”
Jack Dolan, a spokesman at the American Council of Life Insurers, said he believed it unlikely that estate tax reform would be added to the pension bill.
“We strongly support the pension bill,” Dolan added. “It has a variety of provisions that would boost Americans’ retirement security.”
David Stertzer, chief executive of the Association for Advanced Life Underwriting, explained that adding estate tax reform is possible.
“Conference reports are not amendable, and this would be a circuitous way to move estate tax reform forward without providing opportunity for consideration of alternatives on the Senate floor,” he said.
Of greater concern is that what the Republicans are pushing would cost nearly as much as 90% of the cost of full estate tax repeal.