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August 17, 2006 at 12:56 PM
President Bush today put his signature on a bill that is supposed to shore up the Pension Benefit Guaranty Corp. and may create business opportunities for life insurers and life insurance producers.
“Americans who spend a lifetime working hard should be confident that their pensions will be there when they retire,” Bush said at a signing ceremony in the Eisenhower Executive Office Building. “Last year I asked Congress to strengthen protections for the pensions of our workers. Members of both parties came together to pass a good bill that will improve our pension system, while expanding opportunities for Americans to build their own nest-eggs for retirement.”
The primary goal of the new law, which is known as the Pension Protection Act of 2006, was to ensure that employers do a better job of valuing and funding defined benefit pension obligations.
Many pension plans use group annuities as funding vehicles, and that has given life insurers a keen interest in the core pension protection provisions of the PPA, the enacted version of H.R. 4.
Other provisions in the PPA will set marketing standards for corporate-owned life insurance, allow employers to enroll employees in 401(k) plans automatically, and make it easier for investment advisors to advise plan participants.
