January 30, 2004
In this issue:
- Senate Finance Committee to Mark-Up COLI Legislation Monday, Several Amendments to be Considered
Senate Finance Committee to Mark-Up COLI Legislation Monday, Several Amendments to be Considered
As expected, the Senate Finance Committee has released the Chairman's mark of the provisions restricting the use of corporate owned life insurance (COLI) to be considered as a modification of the National Employee Savings and Trust Equity Guaranty Act (NESTEG). The Chairman's mark is essentially the same as the draft proposal made available last week by the Finance Committee.
NESTEG was reported out of committee on September 17, 2003, but the report was not filed pending the resolution of concerns about the proposal on COLI. The Senate Finance Committee has scheduled a mark-up of the COLI provisions for Monday, February 2. Several amendments have been proposed. Concerns have been expressed regarding some of the amendments including: the amendment requiring no retaliation for failure to consent, the amendment requiring additional disclosure in the annual report regarding COLI policies and the reporting requirement regarding the liability for which the COLI is being purchased. One amendment that appears likely to be accepted would require employers to include on their employee notices the maximum face amount, at the time of issue, of the life insurance contract the employer might take out on the life of an employee.
For more information, contact Lynn Dudley, Council vice president & senior counsel, at (202) 289-6700.
The American Benefits Council is the national trade association for companies concerned about federal legislation and regulations affecting all aspects of the employee benefits system. The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans.