Florida State Board of Administration, Tallahassee, issued an invitation to negotiate in a search for providers of annuity products and other insured or non-insured lifetime income solutions as a distribution option for retiring participants of the Florida Retirement System's $8.2 billion 401(a) plan.
Hartford Life Insurance Co., the incumbent, is not rebidding because it is leaving the business, said John Kuczwanski, FSBA communications manager.
FSBA — which oversees $171.7 billion, including the 401(a) plan's assets — could hire one or more firms and offer as options one or more lifetime income solution products, Mr. Kuczwanski said.
Since the inception of the plan in 2002, participants have chosen to place some or all of their 401(a) accounts in group annuities, amounting to a total $25 million, according to the ITN. But any legislative change to make the 401(a) plan the default plan election over the FRS' $138.9 billion defined benefit plan for new participants “could result in a rapidly expanding [401(a) plan] membership, the ITN states, suggesting a potential for rising demand for annuities and other lifetime income products. “Since 2002, over 76,000 [401(a) plan] members have retired and received over $6.7 billion in distributions.”
The ITN is available on FSBA's website. Notifications of intent to respond are due Feb. 17 and responses, March 3. The board expects to make a decision April 4.
Hewitt EnnisKnupp, FSBA investment consultant, is assisting in the search.