WASHINGTON –In testimony today to the U.S. Department of Labor, American Council of Life Insurers (ACLI) President and CEO Susan Neely raised “grave concerns” about the department’s proposed fiduciary regulation and its adverse impact on consumers’ retirement security.

“We all recognize there is a retirement savings gap in this country, and we want to make sure consumers are supported with options and protections – to help our policy leaders close this gap and to help consumers live with certainty in retirement,” Neely said. “It is in the spirit of that shared mission that we must express our grave concerns about the imprudent nature of this proposal.”

Neely stressed that the proposal:

• Is predicated on out-of-date data and a misfocused, incomplete regulatory impact analysis;
• Ignores the robust regulatory system implemented by the states and SEC;
• Seems at odds with actions taken by Congress to close the retirement savings gap in part through expanded access to annuities; and
• Will leave millions of retirees in an untenable financial situation in their most fragile years.

Moreover, the proposal “undervalues the essential role annuities play in providing certainty for middle-income retirees,” Neely said.

“With an option for protected lifetime income and a strong regulatory framework of consumer protections in place, it is no surprise that annuities are a product sought and used by middle-income Americans. The median household income among annuity owners is $76,000. The median household income in the U.S. is $63,000. 

“Annuities provide protection, security, and peace of mind.

“It’s not surprising that people want this product. What IS surprising is a proposal so out of sync with this reality.”

“Our ask is clear: remove this proposal in its entirety and focus instead on increasing access and certainty for American workers saving for retirement,” Neely concluded.

Her full testimony is available here.

The American Council of Life Insurers (ACLI) is the leading trade association driving public policy and advocacy on behalf of the life insurance industry. 90 million American families rely on the life insurance industry for financial protection and retirement security. ACLI’s member companies are dedicated to protecting consumers’ financial wellbeing through life insurance, annuities, retirement plans, long-term care insurance, disability income insurance, reinsurance, and dental, vision and other supplemental benefits. ACLI’s 280 member companies represent 94 percent of industry assets in the United States.

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