If you have not already received this request from the National Retiree Legislative Network, please read on.
By Bill Kadereit
As you may know from reading NRLN messages this year, one of the NRLN’s top legislative priorities for 2023 is to gain the introduction and passage of a bill to protect pension plan participants when a company does “de-risking”. When “de-risking” occurs with the purchase of an insurance annuity, pension plan participants lose the protection of federal laws. A key part of the NRLN’s proposal is that annuity contracts require reinsurance to protect retirees if the primary insurer fails.
The NRLN is using an extensively researched and professionally written whitepaper and recommended legislative language in its lobbying efforts. It would be very useful to be able to present information to Members of Congress and their staffs that document how retirees have been hurt financially through de-risking when an insurance company defaulted on its ability to make annuity payments and there was not another qualified insurance company available to pick up the payments.
When an insurance company fails or is otherwise unable to make good on the annuity payments to protect annuitants and there is not “reinsurance” available, the retiree’s benefits are backed solely by State Guaranty Associations (SGAs). The maximum coverage of state guaranty associations varies widely by state, but most states guarantee only up to $250,000 per person per lifetime. This is usually a small percentage of what the retiree would have received from a lifetime of annuity payments.
If you know of a retiree whose company did de-risking and the insurance company became unable to provide annuity payments, we want to hear from you. If possible, provide the name, phone number and/or email address of the person. Or at least the name of the pension plan company and the insurance company.
Also, if you believe that de-risking caused you or them to lose any other income or healthcare benefits, please add these comments to your response.
Send as much information about the situation as you can provide to the NRLN’s Vice President – Communications at email@example.com.
Bill Kadereit, President
National Retiree Legislative Network