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View More Press Releases by Annuity Research & Consulting™ [ARC]

Press Release

Annuity Offers Due Diligence with ERISA Expert Standards; Bridging the Gap Between Institutional and Retail For 401(k) Plans

Issued by Annuity Research & Consulting™ [ARC]

May 11, 2023

New York, New York and San Clemente, California -- Today, Annuity Research & Consulting™ (ARC) officially announced their formation as a fee-only consultant to 401(k) retirement plans and their recordkeepers; they intend to collaborate with other professionals who serve ERISA fiduciaries.

Founded by industry veterans Michelle Richter-Gordon and Mark Chamberlain, ARC's goal is to transform the DC industry's approach to investigating lifetime income options by bringing an outside expert specialist resource to those who seek objective, thorough and analytical annuity advice. The two operating partners' combined 60 years of experience is from both the insurance and asset management industries, which is a critical requirement for analyzing what are often complex arrangements (they not only read the contracts but interpret them for fiduciaries so they can understand key differences).

As a service provider to plans, ARC's goal is to offer a unique institutional resource to those who feel they need unbiased search capabilities, a rigorous selection process, and/or a proper benchmarking capability for measuring the cost/benefit tradeoffs and monitoring them at a prudent expert level.

ARC is a Registered Investment Advisor with ERISA 3(38) and 3(21) fiduciary capabilities, and will also provide non-fiduciary consulting and education for both sponsors and participants to help them think about ways to integrate annuities with traditional 401(k) investment policy to manage longevity risk.

Ensuring objectivity, ARC charges hourly and project-based fees. "Our institutional philosophy and unconflicted business model will bring a new value proposition to a crowded marketplace that is unique in its philosophy and level of detail," Chamberlain stated.

Their disciplined due diligence process follows industry best practices for analyzing risk and return, utilizing a deeply qualitative, ten-factor process that is engineered to meet or exceed the current Safe Harbor guidelines in ERISA Section 404(e). A Wagner Law Group opinion letter is available upon request.

One of ARC's key evaluations is counterparty risk. "It's something plan sponsors and participants both say is critically important to them," According to Richter-Gordon. "The history of insurers taking risks that were not well understood at the time is sometimes forgotten. Two of the biggest insurance company failures had "A" ratings and top selling annuity products when they faltered. They took risks other companies did not and ended up in trouble when their models broke. The fallout was painful. Past receiverships were not pleasant experiences and consumers should be spared this stress if possible."

"Our 3(38) fiduciary process focuses on screening for the most transparent balance sheets and the least amount of leverage - we see this as a prudent institutional approach and a mandate for us as fiduciaries. Members of Congress and the DOL are currently looking at the reinsurance practices of insurance companies so we don't see how experts can ignore it," Richter-Gordon added.

ARC also offers innovative ideas for retirement education. According to Chamberlain, "evolution in retail retirement planning has been hampered by fragile risk tolerance questionnaires. This has worked out well for the industry but not so well for many retirees. It's time for DC to graduate to the current asset/liability matching model followed by corporate DB plans… we can help."

View More Press Releases by Annuity Research & Consulting™ [ARC]

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