Bill Text: NY S06150 | 2013-2014 | General Assembly | Introduced


Bill Title: Provides protection to certain retirees from de-risking pension transactions.

Spectrum: Moderate Partisan Bill (Democrat 4-1)

Status: (Introduced - Dead) 2014-01-08 - REFERRED TO INSURANCE [S06150 Detail]

Download: New_York-2013-S06150-Introduced.html
                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         6150
                                   I N  S E N A T E
                                      (PREFILED)
                                    January 8, 2014
                                      ___________
       Introduced  by  Sen.  AVELLA -- read twice and ordered printed, and when
         printed to be committed to the Committee on Insurance
       AN ACT to amend the insurance law, in relation to  providing  protection
         to certain retirees from pension de-risking transactions
         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. The insurance law is amended by adding a new section 3219-a
    2  to read as follows:
    3    S 3219-A. PENSION DE-RISKING TRANSACTIONS WITH  AN  ANNUITY.  (A)  ANY
    4  ANNUITY  ISSUED  BY AN INSURANCE COMPANY LICENSED TO DO BUSINESS IN THIS
    5  STATE WHICH SELLS AN ANNUITY INTENDED TO  PROVIDE  PENSION  BENEFITS  TO
    6  RETIREES OF ANY COMPANY, CORPORATION, LIMITED LIABILITY COMPANY OR ASSO-
    7  CIATION SHALL INCLUDE THE FOLLOWING PROVISIONS, INCLUDING BUT NOT LIMIT-
    8  ED TO:
    9    (1)  MANDATORY  DISCLOSURES, REGULATORY APPROVAL AND AN OPPORTUNITY TO
   10  CHALLENGE OR OPT OUT OF ANY PENSION DE-RISKING TRANSACTION THAT ATTEMPTS
   11  TO TRANSFER RETIREE BENEFITS FROM A FEDERAL EMPLOYEE  RETIREMENT  INCOME
   12  SECURITY  ACT  ("ERISA") PROTECTED PLAN TO A SUBSTITUTE BENEFIT PROVIDER
   13  NOT COVERED UNDER ERISA;
   14    (2) SUPPLEMENTAL PROTECTIONS IN THE FORM OF A THIRD PARTY GUARANTEE OR
   15  REINSURANCE CONTRACT SO AS TO EQUAL THE SCOPE OF COVERAGE OFFERED BY THE
   16  PENSION BENEFIT GUARANTY CORPORATION ("PBGC") AFTER AN ANNUITY  PROVIDER
   17  INSOLVENCY  AND  SUBSEQUENT  DETERMINATION  OF ANY SHORTFALLS THAT MIGHT
   18  ARISE AFTER NEW YORK LIFE  AND  HEALTH  INSURANCE  GUARANTY  ASSOCIATION
   19  ("NYLHIGA")  CONTRIBUTIONS  ARE  DETERMINED  SO SELECT RETIREES WITHIN A
   20  PLAN ARE NOT UNFAIRLY DISCRIMINATED AGAINST;
   21    (3) THE PROVISION OF ADDITIONAL PROTECTIONS INCLUDING, BUT NOT LIMITED
   22  TO, MANDATORY DISCLOSURES BY THE TRANSFERRING ENTITY AND THE  SUBSTITUTE
   23  PENSION  BENEFIT  PROVIDER, UNIFORM FIDUCIARY STANDARDS AND DISCLOSURES,
   24  UNIFORM AND EQUIVALENT PROTECTION FROM CREDITORS  AND  BANKRUPTCY  TRUS-
   25  TEES;
   26    (4) ALLOWING RETIREES RECEIVING PENSION BENEFITS THE OPTION TO REQUEST
   27  A  LUMP  SUM  CASH  OUT  OPTION SUBJECT TO CERTAIN MANDATORY DISCLOSURES
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD11644-02-3
       S. 6150                             2
    1  REGARDING THE TAX CONSEQUENCES AND  DISSIPATION  RISKS  ASSOCIATED  WITH
    2  LUMP  SUM DISTRIBUTIONS AND INDEPENDENT LEGAL OR FINANCIAL ADVISOR OVER-
    3  SIGHT;
    4    (5)  THAT  ALL  DE-RISKING  TRANSACTIONS  BE VETTED AND APPROVED BY AN
    5  INDEPENDENT THIRD PARTY CREATED BY AND WITH THE APPROVAL OF  THE  SUPER-
    6  INTENDENT; AND
    7    (6) THAT ALL SUBSEQUENT TRANSFERS OF GROUP ANNUITY CONTRACTS BE VETTED
    8  AND  APPROVED  BY  AN  INDEPENDENT  THIRD  PARTY CREATED BY AND WITH THE
    9  APPROVAL OF THE SUPERINTENDENT.
   10    (B) THE SUPERINTENDENT SHALL PROMULGATE ANY NECESSARY RULES  OR  REGU-
   11  LATIONS NECESSARY FOR THE IMPLEMENTATION OF THIS SECTION.
   12    S 2. This act shall take effect on the one hundred twentieth day after
   13  it shall have become a law and shall apply to all policies and contracts
   14  issued, renewed, modified, altered, or amended on or after such date.
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