Wednesday, April 5, 2017

U.S. Retirement Savings System Strong But Could Be Improved, ACLI Says

Washington, D.C. (April 5, 2017)—In a statement for the congressional record, the American Council of Life Insurers (ACLI) recommended enhancements to build on the success of the current retirement system. The statement was submitted for the Banking, Housing, & Urban Development Subcommittee on Economic Policy hearing titled “The Current State of Retirement Security in the United States.”

ACLI’s recommendations included increasing access to and expanding coverage for workplace savings through:

  • Expansion of multiple employer plans (also known as “open MEPs”);
    “Under a MEP, many businesses can join together to achieve economies of scale and advantages with respect to plan administration and advisory services.”
  • Starter 401(k)s;
    “Small employers should be encouraged to offer workplace savings opportunities with simple administrative rules and no required employer contributions.”
  • Voluntary Auto-IRAs;
    “Employers without a retirement savings plan should be encouraged to automatically enroll employees into a payroll deduct IRA. ‘Auto-IRA’ sponsors should receive the same level of protection and state wage law preemption offered to employers sponsoring ‘Auto-401(k)s.’”
    “SIMPLE IRAs should be made more appealing to small businesses. Permitting a higher level of employer contribution and improving rollover rules could make the plans more valuable to employees.”

ACLI also recommended the following measures to promote awareness and availability of lifetime income solutions:

  • Illustrate individual account balances as guaranteed lifetime income;
    “With this additional income information on a benefit statement, coupled with the Social Security income statement, workers can see how much monthly income they could potentially receive in retirement.”
  • Improve the annuity selection rule for individual account plans;
    “Changes must be made to make it easier for employers to meet their duties while at the same time ensuring a prudent selection.”
  • Promote lifetime income portability;
    “ACLI supports legislation and regulation that would permit the distribution of a participant’s insured plan benefit when a guaranteed lifetime income product is no longer offered by the plan. The rules should permit the distribution to be made via a qualified plan distributed annuity contract or a direct rollover to an IRA or other eligible retirement plan.”

“Over the long run, the nation will benefit when individuals address their long-term financial security needs today, because they will be less likely to rely on public assistance tomorrow,” ACLI’s statement concluded. “Government policies that encourage prudent behavior, such as long-term savings for retirement, should not only be maintained, they should be enhanced. Therefore, ACLI continues to urge policy-makers to support and build on the current retirement savings system.”

Click here to read ACLI’s full statement (PDF).


The American Council of Life Insurers (ACLI) is a Washington, D.C.-based trade association with approximately 290 member companies operating in the United States and abroad. ACLI advocates in state, federal, and international forums for public policy that supports the industry marketplace and the 75 million American families that rely on life insurers’ products for financial and retirement security. ACLI members offer life insurance, annuities, retirement plans, long-term care and disability income insurance, and reinsurance, representing 94 percent of industry assets, 93 percent of life insurance premiums, and 97 percent of annuity considerations in the United States. Learn more at

Date Posted: April 5, 2017
Document ID: NR17-015
Contact: Whit Cornman, 202-624-2442