Predicting the future often is a fool’s errand.
We’ve learned that lesson with the COVID-19 pandemic, the resulting public health crisis and economic upheaval impacting many families.
The extended downturn in the economy has pushed millions out of work, including a disproportionate number of older workers. Many are rightfully concerned about retirement income and even retaining modest financial security.
The challenges for public policymakers are substantial, balancing savings opportunity with adequate consumer protections. We know lawmakers and regulators are committed to expanding opportunities for people to save and plan for a secure retirement.
A little more than a year ago, Congress passed legislation with broad bipartisan support to close the retirement coverage gap for workers. This year, there’s momentum for additional bipartisan action to address the retirement savings gap.
At the same time, the Securities and Exchange Commission (SEC), the National Association of Insurance Commissioners (NAIC), and states from coast-to-coast have acted to ensure that lower- and middle-income savers have access to meaningful retirement income options along with enhanced consumer protections for Americans.
Regulatory and legislative action in these states – with numerous other states considering proposals — reflects the progress achieved for consumer protection with the SEC’s Regulation Best Interest (Reg BI) and the NAIC’s revised model regulation on annuity transactions. Best Interest enhances the standards for sales professionals while ensuring savers retain access to, and information about, annuities. A Best Interest standard has been adopted in Arizona, Iowa, Arkansas, Michigan, Rhode Island, Delaware and Ohio.
It’s a matter of fairness. Annuities are the only savings product that provides income for life, effectively creating one’s own pension. And the average annual income of an annuity owner is $64,000.
Among other challenges, the pandemic and focus on social justice in 2020 drew attention on the need to help more Americans gain their financial footing. This includes greater savings and tools to secure retirement income.
One thing is for certain: it’s important to modernize retirement policies, protect consumers, and safeguard pathways for average-income savers as we work to move America forward with opportunities for everyone to get ahead.
Kimberly Ross was Senior Vice President, Federal Relations at the American Council of Life Insurers (ACLI). She oversaw ACLI’s federal advocacy on financial services, tax, retirement, income security and DEI issues. Before joining ACLI in December 2020, she served 20 years on the Hill most recently as Chief of Staff and Chief Counsel to Rep. Joyce Beatty.
