,,ii #aafth ,,congress #b;d ,session ,s4 #cdag ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,march #i1 #bjbj,mrs4 ,murray 7for herself1 ,ms4 ,smith1 and ,ms4 ,baldwin7 introduced the following bill2 which was read twice and referred to the ,committee on ,health1 ,education1 ,labor1 and ,pensions ,a ,,bill ,to require pension plans that offer participants and beneficiaries the option of receiving lifetime annuity payments as lump sum payments1 to meet certain notice and disclosure requirements4 #a4 ,short title ,this ,act may be cited as the ,information ,needed for ,financial ,options ,risk ,mitigation or the ,,inform ,act4 #b4 ,notice and disclosure requirements with respect to certain lump sum options 7a7 ,in general ,part #a of subtitle ,b of title ,i of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #ajba et seq47 is amended by adding at the end the following3 #aab4 ,notice and disclosure requirements with respect to lump sum options 7a7 ,in general ,a plan sponsor of a pension plan that amends the plan to provide a period of time during which certain participants or beneficiaries who are receiving or will receive lifetime annuity payments into a lump sum under section #dja7;a77#i77;,a77i7 of the ,internal ,revenue ,code of #aihf shall provide notice-- 7#a7 to each participant or beneficiary offered such lump sum amount1 in paper form and mailed to the last known address of the participant or beneficiary1 not later than #ij days prior to the first day on which the participant or beneficiary may make an election with respect to such lump sum2 and 7#b7 to the ,secretary1 not later than #cj days prior to the first day on which participants and beneficiaries may make an election with respect to such lump sum4 7b7 ,notice to participants and beneficiaries 7#a7 ,content ,the notice required under subsection 7a77#a7 shall include the following3 7,a7 ,available benefit options1 including the estimated monthly benefit that the participant or beneficiary would receive at normal retirement age 7if not already in pay status71 whether there is a subsidized early retirement option1 the monthly benefit amount if payments begin immediately1 and the lump sum amount available if the participant or beneficiary takes the option4 7,b7 ,an explanation of how the lump sum was calculated1 including the interest rate1 mortality assumptions1 and whether any additional plan benefits were included in the lump sum1 such as early retirement subsidies4 7,c7 ,the relative value of the lump sum option compared to the plan's lifetime annuity1 in comparable terms4 7,d7 ,whether it would be possible to replicate the plan's stream of payments by purchasing a comparable retail annuity using the lump sum4 7,e7 ,the potential ramifications of accepting the lump sum1 including possible benefits1 investment risks1 longevity risks1 loss of protections guaranteed by the ,pension ,benefit ,guaranty ,corporation 7with an explanation of the monthly benefit amount that would be protected by the ,pension ,benefit ,guaranty ,corporation if the plan is terminated with insufficient assets to pay benefits71 loss of protection from creditors1 loss of spousal protections1 and other protections under this ,act that would be lost4 7,f7 ,general tax rules related to accepting a lump sum1 including rollover options and early distribution penalties with a disclaimer that the plan does not provide tax1 legal1 or accounting advice and a suggestion that participants and beneficiaries consult with their own tax1 legal1 and accounting advisors before determining whether to accept the offer4 7,g7 ,how to accept or reject the offer1 the deadline for response1 and whether a spouse is required to consent to election4 7,h7 ,contact information for the point of contact at the plan sponsor for participants to get more information or ask questions about the option4 7,i7 ,a statement that-- 7i7 financial advisers may not be required to act in the best interests of participants and beneficiaries with respect to determining whether to take the option2 and 7ii7 participants and beneficiaries seeking financial advice should get written confirmation that the adviser is acting as a fiduciary to the participant or beneficiary4 7#b7 ,plain language ,the notice under this subsection shall be written in a manner calculated to be understood by the average plan participant4 7c7 ,notice to the ,secretary ,the notice required under subsection 7a77#b7 shall include the following3 7#a7 ,the total number of participants and beneficiaries eligible for such lump sum option and the number of such participants and beneficiaries who are in pay status during the limited period in which the lump sum is offered4 7#b7 ,the length of the limited period during which the lump sum is offered4 7#c7 ,an explanation of how the lump sum was calculated1 including the interest rate1 mortality assumptions1 and whether any additional plan benefits were included in the lump sum1 such as early retirement subsidies4 7#d7 ,a copy of the notice provided to participants and beneficiaries under subsection 7b74 7d7 ,post-,offer report to the ,secretary 7#a7 ,in general ,not later than #fj days after the conclusion of the limited period during which participants and beneficiaries in a plan may accept a plan's offer to convert their annuity into a lump sum as generally permitted under section #dja7;a77#i7 of the ,internal ,revenue ,code of #aihf1 a plan sponsor shall submit a report to the ,secretary that includes-- 7,a7 the number of participants and beneficiaries who accepted the lump sum offer and a breakdown of the number of those participants and beneficiaries who were in pay status2 and 7,b7 the number and nature of questions that the plan sponsor received from participants and beneficiaries about the offer4 7#b7 ,civil penalties ,the ,secretary may assess a civil penalty of up to #a1jjj a day from the date of any plan administrator's failure or refusal to file a report required under paragraph 7#a74 7e7 ,public availability ,the ,secretary shall make the information provided in the notice to the ,secretary required under subsection 7a77#b7 and in the post-offer reports submitted under subsection 7d77#a7 publicly available4 7f7 ,guidance and regulations ,the ,secretary-- 7#a7 not later than #ahj days after the date of enactment of the ,information ,needed for ,financial ,options ,risk ,mitigation1 shall issue guidance and model notices for plan sponsors to use in providing the notice described in subsection 7b72 and 7#b7 may promulgate such other regulations as may be necessary to carry out this section4 7g7 ,biannual report ,not later than #f months after the date of enactment of the ,information ,needed for ,financial ,options ,risk ,mitigation and every #f months thereafter1 the ,secretary shall submit to ,congress a report that summarizes the notices and post-offer reports received by the ,secretary under subsections 7c7 and 7d7 during the applicable reporting period4 4 7b7 ,clerical amendment ,the table of contents in section #a of the ,employee ,retirement ,income ,security ,act of #aigd is amended by inserting after the item relating to section #aaa the following new item3 ,sec4 #aab4 ,notice and disclosure requirements with respect to certain lump sum options4 7c7 ,enforcement ,section #ejb of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aacb7 is amended-- 7#a7 in subsection 7c77#a71 by striking or section #aje7;a7 and inserting 1 section #aje7;a71 or section #aab7;a72 and 7#b7 in subsection 7a77#d71 by striking #aje7;c7 and inserting section #aje7;c7 or #aab7;a74 7d7 ,effective date ,the amendments made by subsections 7a71 7b71 and 7c7 shall take effect on the date of enactment of this ,act4