Proposal Allowing Annuities as QDIA Re-Introduced

Representatives Donald Norcross (D-NJ) and co-sponsor Tim Walberg (R-MI) have re-introduced the Lifetime Income for Employees Act. H.R. 3942 would allow annuities as a default investment in 401(k) plans.

The Act would direct the Secretary of Labor to amend the current Qualified Default Investment Alternative (QDIA) safe harbor regulations to allow the inclusion of an annuity fixed income component as part of its mix of asset classes to provide a guaranteed return on investments and the option to convert assets into a guaranteed lifetime income stream. The covered annuity contract must meet certain liquidity and participant notice criteria.

The bill has been referred to the House Committee on Education and the Workforce for further consideration.