7 Possible Obstacles to Secure Act Bliss

Some life and annuity groups’ lobbyists may be starting to think about which brand of champagne they ought to try when the Setting Every Community Up for Retirement Enhancement Act of 2019 (Secure Act) becomes law.

Congressional leaders have put the Secure Act in Division O of House Amendment to the Senate Amendment to H.R. 1865.

H.R. 1865 began life as a law enforcement commemorative coin act bill. Congress is now using H.R. 1865 as the tugboat for pulling the 1,773-page Further Consolidated Appropriations Act, 2020 (FCAA 2020) through Congress.

Policymakers in Washington see FCAA 2020 as a “must pass” piece of legislation: If H.R. 1865 does not become law within the next few days, much of the federal government will shut down on Friday.

Groups like the American Council of Life Insurers and the National Association of Insurance and Financial Advisors have helped shape the Secure Act and lavish it with advocacy love. They have supported the bill by issuing press releases, organizing awareness campaigns, and by sending some of the best sales representatives to Capitol Hill to sell members of Congress and their aides on the need to pass the Secure Act.

The act could:

Create a safe harbor that employers could use when they’re choosing group annuity issuers to support 401(k) plan lifetime income stream options.
Help a plan participant transfer a plan lifetime income feature from one plan to another employer-sponsored retirement plan, or to an individual retirement account (IRA).
Require plan sponsors to tell the participants about how much monthly retirement income their assets might produce.
Let people contribute to IRAs even if they are over age 70 1/2.
Provide much richer tax credits for small employers that start new retirement plans.
Allow small employers to participate in multiple employer defined contribution retirement plans, or MEPS.

But the future on Capitol Hill is always uncertain, and, even if and when the Secure Act provision in H.R. 1865 becomes law, the same groups that fought hard for passage of the law will still have to fight hard to make the Secure Act do what they were hoping it would do.

Insurers, other financial services companies, and people like you will have to fight hard to convert new rules into products that customers want to buy.

For seven reasons why the life and annuity legislative and regulatory affairs people still can’t sit back and play with their phones, see the slideshow above. (Wiggle your pointer over the first slide to make the control arrows show up.)

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