Bill Overview
Title: General Accounts Product Clarifications Act
Description: This bill specifies requirements for the application of the Employee Retirement Income Security Act of 1974 (ERISA) to general account policies that receive contributions from employee benefit plans. A general account policy is an insurance policy or contract to the extent that the policy or contract allocates amounts to the insurer's general account, including any surplus in a separate account but excluding any other portion of a separate account.
Sponsors: Rep. Morelle, Joseph D. [D-NY-25]
Target Audience
Population: People with employee retirement plans managed under general account policies
Estimated Size: 56000000
- ERISA is a federal law that sets minimum standards for most voluntarily established retirement and health plans in private industry to provide protection for individuals in these plans.
- The bill deals with insurance policies related to general accounts, which are used by insurance companies to manage premiums collected from policyholders for the purpose of investment.
- It affects insurers who hold and manage these general account policies as well as the employee benefit plans contributing to these accounts.
- Employee benefit plans that use general account policies tend to be part of larger organizations or companies that offer retirement benefits.
Reasoning
- The policy primarily affects individuals with employee benefit plans managed using general account policies. Therefore, this simulation should focus on diverse representation from this group, including those in various roles that may indirectly influence their wellbeing scores.
- Budget limitations signal that the policy cannot impact everyone positively due to financial constraints. It can lead to mixed feelings from individuals based on their role and involvement with the employee benefit plans.
- Considering the policy's focus on enhancing clarity and regulation, higher trust and understanding could be potential positive outcomes, but actual wellbeing changes might be modest given the specific focus and population size.
- Including interviews with individuals from different occupations and levels of retirement savings allows for a more comprehensive understanding of potential disparate impacts of the policy.
- A range of geographical locations should be represented since different states may have various regulatory landscapes influencing how these policies impact their workforce.
Simulated Interviews
HR Manager (New York, NY)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 10/20
Statement of Opinion:
- The policy seems like it may enhance clarity on how our retirement contributions are managed, which is a relief.
- I believe this could simplify my job when discussing benefits with employees.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 9 | 7 |
Retired (Phoenix, AZ)
Age: 62 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 8/20
Statement of Opinion:
- I hope this policy ensures my pension is stable and secure as it's my primary income source.
- More clarity is always appreciated but I am unsure how direct the impact will be.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Software Engineer (Denver, CO)
Age: 34 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 15/20
Statement of Opinion:
- I am generally unaware of the intricacies of how my retirement plan is managed.
- This policy might make me more interested in understanding how my contributions are handled.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 8 | 9 |
Insurance Policy Analyst (Chicago, IL)
Age: 51 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- The policy will directly affect my workload, possibly making compliance reviews more streamlined.
- It’s a necessary clarification to ensure the plans are managed lawfully.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
Financial Advisor (Austin, TX)
Age: 29 | Gender: other
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 13/20
Statement of Opinion:
- The policy is another layer of information to consider when advising clients.
- I foresee minimal changes to most clients' situations on a personal level.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Marketing Director (San Francisco, CA)
Age: 44 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 9/20
Statement of Opinion:
- I'm not sure how this policy will affect my actual retirement outcome, but I hope it aids in stability.
- Understanding these policies can give more peace of mind.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 7 | 5 |
Small Business Owner (Miami, FL)
Age: 39 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 6/20
Statement of Opinion:
- Additional regulations, while beneficial, might increase costs that small businesses like mine have to bear.
- I understand the need for such policies but hope for support in compliance.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 8 | 6 |
Public School Teacher (Seattle, WA)
Age: 47 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 14/20
Statement of Opinion:
- Since I am part of a union, much of my benefits are already structured.
- I’m curious if this policy will affect future negotiations or options available to us.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Logistics Manager (Columbus, OH)
Age: 53 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 7.0 years
Commonness: 12/20
Statement of Opinion:
- Our company can use this policy to better articulate investment choices to employees.
- More transparency is generally good, particularly in handling complaints.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Insurance Broker (Boston, MA)
Age: 41 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- My role involves explaining policies like these, making me supportive of clearer guidelines.
- I anticipate this would lead to fewer disputes or questions from clients.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 9 | 8 |
| Year 10 | 9 | 8 |
| Year 20 | 9 | 8 |
Cost Estimates
Year 1: $15000000 (Low: $10000000, High: $20000000)
Year 2: $12000000 (Low: $8000000, High: $16000000)
Year 3: $10000000 (Low: $7000000, High: $13000000)
Year 5: $9000000 (Low: $6000000, High: $12000000)
Year 10: $5000000 (Low: $3000000, High: $7000000)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- The bill focuses on compliance with ERISA, which is central to employee benefits security, ensuring that employee retirement plans are managed correctly.
- Insurance companies might need to undergo structural adjustments, potentially impacting their financial statements during the initial years.
- Long-term cost savings for insurers might offset initial compliance expenses, resulting in a stabilized financial outlook beyond the adjustment period.