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Agilis Pooled Employer Plan Market Update, H1 2024

"The returning Pooled Plan Providers (PPPs) [surveyed] averaged a 41% growth in assets fueled by a 22% increase in the number of adopting employers combined with market performance in the first half of 2024.... The implementation of SECURE 2.0 Act provisions is continuing to influence the PEP market.... Awareness campaigns promoting the advantages of PEPs have gained further momentum."

Agilis Written Submission to the ERISA Advisory Council Regarding DOL Interpretive Bulletin 95-1

"[Agilis believes] the standard in its current form has many strengths that have helped to secure defined benefit plan participants' benefits at levels beyond those guaranteed by the [PBGC]. That said, as the PRT market has evolved since the inception of DOL 95-1.... there are areas the DOL should consider to strengthen the guidance to plan sponsors in their evaluation of potential insurers."

The Impacts of SECURE 1.0 and SECURE 2.0 on Pooled Employer Plans

"SECURE 1.0 laid the groundwork for PEPs by allowing for their establishment and easing regulatory burdens for plan sponsors. Key provisions included: Increased Access ... [and] Fiduciary Relief ... SECURE 2.0 introduced several optional provisions designed to further incentivize participation in retirement savings plans, particularly through PEPs."

Challenges for Lifetime Income Solutions in DC Plans: What's Missing?

"Employers face fiduciary risk when selecting and monitoring in-plan solutions.... Employers may be hesitant to add complexity to their plans without assurance that participants will value the option.... Annuities are often perceived as expensive due to high commissions.... One potential solution is to use out-of-plan annuities alongside a DC plan"

Insurer Safety in Pension Risk Transfer: Analysis of NISA's Proposed Use of Credit Spreads

"[1] Policyholder losses incurred due to insurer failure are expected to be very low, even before allowing for the presence of state guaranty systems.... [2] The credit risk priced into bonds issued by insurers is not equivalent to expected policyholder losses.... [3] NISA's approach does not allow for the substantial additional protection provided by separate accounts and by the State Guaranty Association system.... [4] Plan sponsor failure is generally much more likely than that of a well rated insurance company.... [5] Credit spreads on Funding Agreement Backed Notes have limited reliability as a metric."

U.S. Pension Briefing, September 2023

"September saw a remarkable surge in pension discount rates, reaching levels unseen in over a decade. Global equities and fixed income both posted negative returns. Pension plans, on the whole, maintained or slightly improved their funded status, as asset declines were slightly less than liability decreases."

Facilitating Conversion of 401(k) Participant Balances to Lifetime Income

"Retirement plan sponsors have offered in-plan insurance company annuity conversions with very little success (less than 5% utilization and many in the industry say less than 1%).... 16 employers have been seeing an average of almost 25% of eligible balances converted since 2007. These employers offer retiring employees the option to convert all or part of their 401(k) balance to lifetime income options through the company's defined benefit plan by transferring a portion of their balance into the defined benefit plan."

A Significant Number of Employees Will Take Lifetime Income When Given the Choice

"In a defined benefit plan termination, employees are generally given the choice to take their benefit as a lifetime annuity ... or an account balance ... While employees with smaller benefits tend to take the account balance option, 34% of the dollars for employees over age 55 were moved to insurance companies to provide lifetime income. This is a much larger utilization rate than seen in the retail annuity market or in-plan defined contribution plan offerings."

U.S. Pension Briefing, May 2023

"Pension discount rates rose almost a quarter of a percentage point in May, erasing much of the fall in rates we had seen so far this year.... While equity market returns coincided with a decline in fixed income indices (and therefore also plan liabilities), May's change in funded status for most pension plans will show anywhere from a slight to moderate improvement."

Unraveling PEP Fee Disparity: Understanding the Details Matters

"[T]here is a wide disparity in both the type of fee and the fee levels charged by different PEP providers. ... [It] is essential to understand all fees and reasons for any disparities to be able to accurately compare providers.... [F]actors include but are not limited to, the level of services offered, the size of the plan, the investment options offered, the level of fiduciary responsibility assumed, and the regulatory environment."