Congressional negotiators are making progress in combining conflicting House-Senate pension benefit reform bills, according to members of Congress and industry lobbyists, raising hopes that work on the bills can be completed before the summer recess begins July 27.
Sen. Charles Grassley, R-Iowa, chairman of the Senate Finance Committee and a chief negotiator on the bill, said July 11 that drafters only have “loose ends” to tie up on major issues involved in the bill, and parts of it already are being drafted into legislative language.
“There are still some loose ends to be finalized on the major issues, but they are really loose ends,” Grassley said.
But those “loose ends” include defined contribution provisions in the legislation critical to the life insurance industry that remain to be negotiated, said Michael Kerley, senior vice president, federal government relations, at the National Association of Insurance and Financial Advisors.
Kerley said he is becoming “reasonably optimistic” that some language will be included in the final bill that is supportive of allowing insurance agents to provide investment advice in cases where the insurer they work for administers a 401(k) program for a company.
He said he is also cautiously optimistic about a provision in the House version of the bill that will allow agents to sell annuities that include a long term care rider and about a provision in both bills that will provide for automatic enrollment in 401(k) programs for new employees.
There is a view that the final bill will include a phase-in of the LTC rider provision because of the potential cost in terms of federal revenues.
But one provision contained in the Senate remains to be negotiated, Kerley said. It would codify current tax treatment of corporate-owned life insurance and create certain best practices for sales.