Defined terms for the annuity market and lifetime income landscape.
The exclusive benefit rule is the ERISA fiduciary duty of loyalty requiring a plan fiduciary to discharge duties solely in the interest of plan participants and beneficiaries, and for the exclusive purpose of providing benefits to them and defraying reasonable expenses of administering the plan.
Executive Order 14330 directs the Department of Labor and SEC to reduce regulatory barriers to alternative asset investments in defined contribution retirement plans — a category the order's Section 3(a) defines to include lifetime income strategies and longevity risk-sharing pools.
Fee disclosure under ERISA 408(b)(2) is the required disclosure that covered service providers to an ERISA-covered retirement plan must give to the responsible plan fiduciary, describing the services provided, the direct and indirect compensation received, and the fiduciary status of the provider.
A fiduciary breach is a failure by an ERISA plan fiduciary to satisfy one or more of the fiduciary duties imposed by ERISA — most commonly the duties of loyalty, prudence, diversification, or adherence to plan documents — exposing the fiduciary to personal liability for participant losses.
The fiduciary safe harbor for annuity selection is the statutory protection under ERISA Section 404(e) — added by the SECURE Act — that shields a plan fiduciary from liability for insurance carrier selection when specified due diligence procedures are followed.
