S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                        6796--A
                              2015-2016 Regular Sessions
                                 I N  A S S E M B L Y
                                     April 2, 2015
                                      ___________
       Introduced  by  M. of A. ABBATE, GOLDFEDER, SKOUFIS, GALEF, BROOK-KRASNY
         -- Multi-Sponsored by -- M. of A. BRAUNSTEIN, CURRAN, HEVESI  --  read
         once   and  referred  to  the  Committee  on  Insurance  --  committee
         discharged, bill amended, ordered reprinted as amended and recommitted
         to said committee
       AN ACT to amend the insurance law, in relation to  providing  protection
         to certain retirees from pension de-risking transactions; and to amend
         the  civil  practice  law and rules, in relation to statutorily exempt
         payments
         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) FOR
    4  PURPOSES OF THIS SECTION: (1) "EMPLOYER" MEANS  ANY  PERSON  ENGAGED  IN
    5  BUSINESS  IN  THIS  STATE  WHO  HAS  TWO OR MORE EMPLOYEES, BUT DOES NOT
    6  INCLUDE THE STATE OR ANY POLITICAL SUBDIVISION THEREOF;
    7    (2) "EMPLOYEE PENSION BENEFIT PLAN" MEANS AN "EMPLOYEE PENSION BENEFIT
    8  PLAN", AS DEFINED IN 29 USC 1002(2)(A); AND
    9    (3)  "PENSION  DE-RISKING  TRANSACTION"  MEANS  ANY  TRANSACTION  THAT
   10  INVOLVES  THE  TRANSFER  OF  PENSION BENEFITS (NOT INCLUDING HEALTH CARE
   11  BENEFITS) FROM A PENSION PLAN PROTECTED UNDER  THE  EMPLOYEE  RETIREMENT
   12  INCOME  SECURITY  ACT ("ERISA") TO A SUBSTITUTE PENSION BENEFIT PROVIDER
   13  SUCH AS AN INSURANCE COMPANY LICENSED AND REGULATED UNDER STATE LAW.
   14    (B) ANY INSURER ISSUING AN  ALLOCATED  OR  UNALLOCATED  GROUP  ANNUITY
   15  CONTRACT  TO  AN EMPLOYER OR AN EMPLOYEE DEFINED PENSION BENEFIT PLAN ON
   16  BEHALF OF AN EMPLOYER, FOR THE PURPOSE OF PROVIDING RETIREMENT  BENEFITS
   17  TO  EMPLOYEES  OR  FORMER  EMPLOYEES ("RETIREES") OF THE EMPLOYER, WHICH
   18  ANNUITY BENEFITS WILL NO LONGER BE PROTECTED UNDER THE FEDERAL  EMPLOYEE
   19  RETIREMENT INCOME SECURITY ACT OF 1974 ("ERISA") AND THE FEDERAL PENSION
   20  BENEFIT GUARANTY CORPORATION ("PBGC") SHALL PROVIDE THE FOLLOWING INFOR-
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD02147-06-5
       A. 6796--A                          2
    1  MATION  TO  THE  RETIREES  PURSUANT TO REGULATIONS ADOPTED BY THE SUPER-
    2  INTENDENT:
    3    (1)  A  CLEAR  STATEMENT  THAT PAYMENTS TO ANNUITANTS UNDER AN ANNUITY
    4  CONTRACT ISSUED PURSUANT TO THIS SECTION ARE EXEMPT FROM THE  CLAIMS  OF
    5  CREDITORS;
    6    (2) A STATEMENT THAT THE RETIREES WILL NO LONGER HAVE PROTECTION UNDER
    7  ERISA AND THE PBGC;
    8    (3)  THE  IDENTITY  AND  CONTACT INFORMATION FOR THE NEW YORK LIFE AND
    9  HEALTH INSURANCE GUARANTY ASSOCIATION, OR ANY SUBSTITUTE OR  REPLACEMENT
   10  GUARANTY  ASSOCIATION  THAT  PROVIDES COVERAGE TO ANNUITANTS RESIDING IN
   11  NEW YORK IN THE EVENT OF THE INSURER'S FINANCIAL IMPAIRMENT OR INSOLVEN-
   12  CY, AS SET FORTH ON A PUBLICLY AVAILABLE WEBSITE  SUCH  AS  THE  WEBSITE
   13  MAINTAINED  BY  THE  LIFE  INSURANCE COMPANY GUARANTY CORPORATION OF NEW
   14  YORK (WWW.NYLIFEGA.ORG); AND
   15    (4) MANDATORY ANNUAL DISCLOSURES TO ALL RETIREES  WHOSE  BENEFITS  ARE
   16  TRANSFERRED  TO AN INSURANCE COMPANY OR ALTERNATIVE BENEFIT PROVIDER FOR
   17  THE PURPOSE OF PROVIDING RETIREMENT BENEFITS, OF THE FOLLOWING:  FUNDING
   18  LEVELS  OF ALL ASSETS RELATIVE TO EXPECTED LIABILITIES UNDER THE ASSUMED
   19  PENSION BENEFIT  SCHEDULES,  INVESTMENT  PERFORMANCE  SUMMARY  BY  ASSET
   20  CLASS, INVESTMENT PERFORMANCE DETAIL BY ASSET CLASS, EXPENSES ASSOCIATED
   21  WITH  ANY  GROUP  ANNUITY CONTRACT, CHANGES IN ACTUARIAL ASSUMPTIONS, IF
   22  ANY.
   23    (C) NO ALLOCATED OR UNALLOCATED GROUP ANNUITY CONTRACT  ISSUED  BY  AN
   24  INSURER  TO  AN  EMPLOYER OR AN EMPLOYEE DEFINED PENSION BENEFIT PLAN ON
   25  BEHALF OF AN EMPLOYER, FOR THE PURPOSE OF PROVIDING RETIREMENT  BENEFITS
   26  TO EMPLOYEES OR FORMER EMPLOYEES OF THE EMPLOYER, WHICH ANNUITY BENEFITS
   27  WILL NO LONGER BE PROTECTED UNDER THE FEDERAL EMPLOYEE RETIREMENT INCOME
   28  SECURITY  ACT  OF  1974  AND THE FEDERAL PENSION BENEFIT GUARANTY CORPO-
   29  RATION MAY BE FURTHER TRANSFERRED OR ASSUMED BY ANOTHER INSURER  WITHOUT
   30  CONFIRMATION  BY  THE SUPERINTENDENT THAT THE INSURER ASSUMING THE OBLI-
   31  GATIONS OF SUCH ALLOCATED OR UNALLOCATED GROUP ANNUITY CONTRACT HAS  THE
   32  FINANCIAL  STRENGTH TO FULFILL ITS OBLIGATIONS UNDER SUCH CONTRACT.  THE
   33  APPROPRIATE STANDARD TO BE APPLIED BY THE SUPERINTENDENT SHALL  BE  400%
   34  OF  COMPANY  ACTION  LEVEL  RISK BASED CAPITAL WITH NO NEGATIVE TREND AS
   35  DEFINED BY THE 2012 NAIC RISK-BASED CAPITAL  (RBC)  FOR  INSURERS  MODEL
   36  ACT.
   37    (D)  THE  PROCEEDS  OF  ANY  ALLOCATED  OR  UNALLOCATED  GROUP ANNUITY
   38  CONTRACT ISSUED BY AN INSURER TO AN  EMPLOYER  OR  AN  EMPLOYEE  DEFINED
   39  PENSION  BENEFIT  PLAN  ON  BEHALF  OF  AN  EMPLOYER, FOR THE PURPOSE OF
   40  PROVIDING RETIREMENT BENEFITS TO RETIREES OF THE EMPLOYER, WHICH ANNUITY
   41  BENEFITS WILL NO LONGER BE PROTECTED UNDER ERISA AND  THE  FEDERAL  PBGC
   42  SHALL  BE EXEMPT FROM APPLICATION TO THE SATISFACTION OF MONEY JUDGMENTS
   43  UNDER SECTION FIFTY-TWO HUNDRED FIVE  OF  THE  CIVIL  PRACTICE  LAW  AND
   44  RULES.
   45    S 2. Paragraph 2 of subdivision (l) of section 5205 of the civil prac-
   46  tice  law  and  rules,  as amended by chapter 24 of the laws of 2009, is
   47  amended to read as follows:
   48    2. For purposes of this article, "statutorily exempt  payments"  means
   49  any  personal  property exempt from application to the satisfaction of a
   50  money judgment under any provision of state or federal  law.  Such  term
   51  shall include, but not be limited to, payments from any of the following
   52  sources: social security, including retirement, survivors' and disabili-
   53  ty  benefits,  supplemental  security  income or child support payments;
   54  veterans administration benefits; public  assistance;  workers'  compen-
   55  sation;  unemployment  insurance;  public  or private pensions; railroad
   56  retirement; and black lung  benefits.    "STATUTORILY  EXEMPT  PAYMENTS"
       A. 6796--A                          3
    1  SHALL  SPECIFICALLY  INCLUDE  ANY  ANNUITY  PROCEEDS  WHOSE BENEFITS ARE
    2  TRANSFERRED TO AN INSURANCE COMPANY OR ALTERNATIVE BENEFIT PROVIDER  FOR
    3  THE  PURPOSE  OF PROVIDING RETIREMENT BENEFITS PURSUANT TO SECTION THREE
    4  THOUSAND  TWO  HUNDRED  NINETEEN-A  OF  THE  INSURANCE  LAW IN A PENSION
    5  DE-RISKING TRANSFER.
    6    S 3. This act shall take effect on the one hundred twentieth day after
    7  it shall have become a law and shall apply to all policies and contracts
    8  issued, renewed, modified, altered, or amended on or after such date.