Now that President Donald Trump has signed H.R. 748 — the $2 trillion Coronavirus Aid Relief and Economic Security (CARES) Act aid package — into law, life and annuity community are talking about what else they’d like to see Congress do.
Many groups have put out statements praising Congress for passing the CARES Act and the president for signing it.
Kevin Mayeux, the chief executive officer of the National Association of Insurance and Financial Advisors (NAIFA), says the final version of the act already contains many of the items NAIFA has been seeking.
“Small business loans to cover short-term payroll and other expenses, which could be forgiven at a future date; payroll tax exemptions; and relief from retirement-account withdrawal requirements and early withdrawal penalties have been at the top of NAIFA’s advocacy efforts and will be crucial to many NAIFA members and their Main Street USA clients,” Mayeux says in his statement.
- The H.R. 748 Congress.gov page is available here.
- An article about passage of H.R. 748 is available here.
Marc Cadin, the chief executive officer of AALU/GAMA, says the CARES Act should give Americans critical help with overcoming COVID-19-related disruption.
“The resilience of this nation is being tested,” Cadin says. “We all have to do our part to ensure Americans have the necessary tools to restore their financial security, and we are here to help not only our members but every person in this profession and all the people they serve.”
For the insurance sector in general, the hottest major battle may be over a property and casualty insurance issue: Whether states or the federal government should force providers of business interruption insurance to cover COVID-19-related claims, even if the business interruption specifically excluded coverage for disruption related to infectious disease outbreaks.
Both the National Association of Insurance Commissioners and the National Council of Insurance Legislators (NCOIL) have objected to the idea of the government imposing a huge claim burden on insurers retroactively.
Tom Considine, NCOIL’s CEO, has suggested that, instead, Congress should set up a federal claims fund that would resemble the 9/11 Victims Compensation Fund.
Here are four policy ideas that could affect life, health and annuity professionals.
1. Tax Deductibility for Advisory Fees
The Financial Services Institute and many other groups have accepted the idea that the CARES Act includes a withdrawal penalty exemption provision that will make it easier for get cash out of their retirement accounts early.
FSI has suggested that Congress could compensate for some of the effects of that provision on retirement security by reinstating the tax deductibility of advisory fees.
“This would provide some financial relief to many Americans who are seeking professional financial advice due to the market turmoil,” FSI says.