Overview

With increased longevity and the decline of traditional pension plans, Americans need new ways to create and guarantee lifetime income for retirement. An annuity can provide a steady stream of income for life—no matter how long retirement lasts.

ACLI Position

Policy-makers should explore ways to encourage more Americans to think about ways to secure guaranteed lifetime income in retirement. ACLI supports legislation, such as the Lifetime Income Disclosure Act (S. 2832) that would require defined contribution plan sponsors to provide workers with information about how their private retirement savings translates into guaranteed monthly income payouts (see our Issue Brief for more information).

ACLI also supports initiatives that would create federal tax incentives for lifetime annuitization; encourage defined contribution plan sponsors to include annuities as distribution options; allow for partial annuitization; and facilitate longevity insurance.

In addition, ACLI supports uniform adoption of a package of state regulations to enhance consumer protections in the annuity sales process. These regulations would improve disclosure to consumers, help ensure sales recommendations are suitable, and make sure annuities are sold by individuals using proper credentials. While each part of the package is important on its own, state regulators would take an enormous step forward in providing annuity consumers with high-level and comprehensive protections through a holistic approach that addresses these three critical areas. We also are working with regulators to have templates for writing improved annuity disclosures become part of the regulatory regime.