Assembly Bill A6796A

                            
                    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:

  Section 1. The insurance law is amended by adding a new section 3219-a
to read as follows:
  S  3219-A.  PENSION  DE-RISKING  TRANSACTIONS WITH AN ANNUITY. (A) FOR
PURPOSES OF THIS SECTION: (1) "EMPLOYER" MEANS  ANY  PERSON  ENGAGED  IN
BUSINESS  IN  THIS  STATE  WHO  HAS  TWO OR MORE EMPLOYEES, BUT DOES NOT
INCLUDE THE STATE OR ANY POLITICAL SUBDIVISION THEREOF;
  (2) "EMPLOYEE PENSION BENEFIT PLAN" MEANS AN "EMPLOYEE PENSION BENEFIT
PLAN", AS DEFINED IN 29 USC 1002(2)(A); AND
  (3)  "PENSION  DE-RISKING  TRANSACTION"  MEANS  ANY  TRANSACTION  THAT
INVOLVES  THE  TRANSFER  OF  PENSION BENEFITS (NOT INCLUDING HEALTH CARE
BENEFITS) FROM A PENSION PLAN PROTECTED UNDER  THE  EMPLOYEE  RETIREMENT
INCOME  SECURITY  ACT ("ERISA") TO A SUBSTITUTE PENSION BENEFIT PROVIDER
SUCH AS AN INSURANCE COMPANY LICENSED AND REGULATED UNDER STATE LAW.
  (B) ANY INSURER ISSUING AN  ALLOCATED  OR  UNALLOCATED  GROUP  ANNUITY
CONTRACT  TO  AN EMPLOYER OR AN EMPLOYEE DEFINED PENSION BENEFIT PLAN ON
BEHALF OF AN EMPLOYER, FOR THE PURPOSE OF PROVIDING RETIREMENT  BENEFITS
TO  EMPLOYEES  OR  FORMER  EMPLOYEES ("RETIREES") OF THE EMPLOYER, WHICH
ANNUITY BENEFITS WILL NO LONGER BE PROTECTED UNDER THE FEDERAL  EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974 ("ERISA") AND THE FEDERAL PENSION
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

MATION  TO  THE  RETIREES  PURSUANT TO REGULATIONS ADOPTED BY THE SUPER-
INTENDENT:
  (1)  A  CLEAR  STATEMENT  THAT PAYMENTS TO ANNUITANTS UNDER AN ANNUITY
CONTRACT ISSUED PURSUANT TO THIS SECTION ARE EXEMPT FROM THE  CLAIMS  OF
CREDITORS;
  (2) A STATEMENT THAT THE RETIREES WILL NO LONGER HAVE PROTECTION UNDER
ERISA AND THE PBGC;
  (3)  THE  IDENTITY  AND  CONTACT INFORMATION FOR THE NEW YORK LIFE AND
HEALTH INSURANCE GUARANTY ASSOCIATION, OR ANY SUBSTITUTE OR  REPLACEMENT
GUARANTY  ASSOCIATION  THAT  PROVIDES COVERAGE TO ANNUITANTS RESIDING IN
NEW YORK IN THE EVENT OF THE INSURER'S FINANCIAL IMPAIRMENT OR INSOLVEN-
CY, AS SET FORTH ON A PUBLICLY AVAILABLE WEBSITE  SUCH  AS  THE  WEBSITE
MAINTAINED  BY  THE  LIFE  INSURANCE COMPANY GUARANTY CORPORATION OF NEW
YORK (WWW.NYLIFEGA.ORG); AND
  (4) MANDATORY ANNUAL DISCLOSURES TO ALL RETIREES  WHOSE  BENEFITS  ARE
TRANSFERRED  TO AN INSURANCE COMPANY OR ALTERNATIVE BENEFIT PROVIDER FOR
THE PURPOSE OF PROVIDING RETIREMENT BENEFITS, OF THE FOLLOWING:  FUNDING
LEVELS  OF ALL ASSETS RELATIVE TO EXPECTED LIABILITIES UNDER THE ASSUMED
PENSION BENEFIT  SCHEDULES,  INVESTMENT  PERFORMANCE  SUMMARY  BY  ASSET
CLASS, INVESTMENT PERFORMANCE DETAIL BY ASSET CLASS, EXPENSES ASSOCIATED
WITH  ANY  GROUP  ANNUITY CONTRACT, CHANGES IN ACTUARIAL ASSUMPTIONS, IF
ANY.
  (C) NO ALLOCATED OR UNALLOCATED GROUP ANNUITY CONTRACT  ISSUED  BY  AN
INSURER  TO  AN  EMPLOYER OR AN EMPLOYEE DEFINED PENSION BENEFIT PLAN ON
BEHALF OF AN EMPLOYER, FOR THE PURPOSE OF PROVIDING RETIREMENT  BENEFITS
TO EMPLOYEES OR FORMER EMPLOYEES OF THE EMPLOYER, WHICH ANNUITY BENEFITS
WILL NO LONGER BE PROTECTED UNDER THE FEDERAL EMPLOYEE RETIREMENT INCOME
SECURITY  ACT  OF  1974  AND THE FEDERAL PENSION BENEFIT GUARANTY CORPO-
RATION MAY BE FURTHER TRANSFERRED OR ASSUMED BY ANOTHER INSURER  WITHOUT
CONFIRMATION  BY  THE SUPERINTENDENT THAT THE INSURER ASSUMING THE OBLI-
GATIONS OF SUCH ALLOCATED OR UNALLOCATED GROUP ANNUITY CONTRACT HAS  THE
FINANCIAL  STRENGTH TO FULFILL ITS OBLIGATIONS UNDER SUCH CONTRACT.  THE
APPROPRIATE STANDARD TO BE APPLIED BY THE SUPERINTENDENT SHALL  BE  400%
OF  COMPANY  ACTION  LEVEL  RISK BASED CAPITAL WITH NO NEGATIVE TREND AS
DEFINED BY THE 2012 NAIC RISK-BASED CAPITAL  (RBC)  FOR  INSURERS  MODEL
ACT.
  (D)  THE  PROCEEDS  OF  ANY  ALLOCATED  OR  UNALLOCATED  GROUP ANNUITY
CONTRACT ISSUED BY AN INSURER TO AN  EMPLOYER  OR  AN  EMPLOYEE  DEFINED
PENSION  BENEFIT  PLAN  ON  BEHALF  OF  AN  EMPLOYER, FOR THE PURPOSE OF
PROVIDING RETIREMENT BENEFITS TO RETIREES OF THE EMPLOYER, WHICH ANNUITY
BENEFITS WILL NO LONGER BE PROTECTED UNDER ERISA AND  THE  FEDERAL  PBGC
SHALL  BE EXEMPT FROM APPLICATION TO THE SATISFACTION OF MONEY JUDGMENTS
UNDER SECTION FIFTY-TWO HUNDRED FIVE  OF  THE  CIVIL  PRACTICE  LAW  AND
RULES.
  S 2. Paragraph 2 of subdivision (l) of section 5205 of the civil prac-
tice  law  and  rules,  as amended by chapter 24 of the laws of 2009, is
amended to read as follows:
  2. For purposes of this article, "statutorily exempt  payments"  means
any  personal  property exempt from application to the satisfaction of a
money judgment under any provision of state or federal  law.  Such  term
shall include, but not be limited to, payments from any of the following
sources: social security, including retirement, survivors' and disabili-
ty  benefits,  supplemental  security  income or child support payments;
veterans administration benefits; public  assistance;  workers'  compen-
sation;  unemployment  insurance;  public  or private pensions; railroad
retirement; and black lung  benefits.    "STATUTORILY  EXEMPT  PAYMENTS"

A. 6796--A                          3

SHALL  SPECIFICALLY  INCLUDE  ANY  ANNUITY  PROCEEDS  WHOSE BENEFITS ARE
TRANSFERRED TO AN INSURANCE COMPANY OR ALTERNATIVE BENEFIT PROVIDER  FOR
THE  PURPOSE  OF PROVIDING RETIREMENT BENEFITS PURSUANT TO SECTION THREE
THOUSAND  TWO  HUNDRED  NINETEEN-A  OF  THE  INSURANCE  LAW IN A PENSION
DE-RISKING TRANSFER.
  S 3. This act shall take effect on the one hundred twentieth day after
it shall have become a law and shall apply to all policies and contracts
issued, renewed, modified, altered, or amended on or after such date.