ING Responds to DOL Request for Information on Electronic Disclosure by Employee Benefit Plans
Supports greater access to plan information through e-delivery methods
ING Insurance U.S. (ING) announced today that it has filed suggestions and comments in response to a Department of Labor (DOL) request for information on the use of electronic media by employee benefit plans subject to the Employee Retirement Income Security Act (ERISA).
The Department is evaluating whether existing ERISA standards for the electronic distribution and delivery of plan disclosures to participants and their beneficiaries should be extended or modified. This includes the current electronic disclosure “safe harbor” provision set forth in ERISA.
“Communication is the cornerstone of our service to customers, and those who elect to participate in a workplace retirement plan must be given clear, timely and systematic information on a wide range of plan matters and activities,” said Rob Leary, President and COO of ING Insurance U.S. “Research today shows us that more and more Americans are embracing electronic communications — internet, email, smartphones and tablets — and increasingly view these vehicles as convenient ways to receive plan and account information and updates. ING commends the Department for exploring this important topic, and evaluating how regulations might change to better reflect the latest trends and help improve the customer experience.”
As a leading provider of workplace retirement plans and an advocate for greater savings, ING is responding to this request for information in an effort to shape positive change, update and modernize guidelines and promote electronic disclosure to the greatest extent possible.
Through its filing, ING supports a number of key positions with respect to electronic disclosure. These include the following:
Electronic media is a powerful channel for reaching participants of employee benefit plans. The technology landscape is dynamically changing, with many new and exciting ways to deliver both general and personalized information to individuals in a timely and cost-efficient manner. ING believes the industry needs to embrace these technologies and electronic media environments as they are setting new expectations among eligible and participating plan members and their beneficiaries.
Promoting electronic delivery can lead to cost savings, efficiencies and the use of fewer resources. Significant benefits can be realized through greater use of electronic disclosure. For many plan sponsors and service providers, going electronic can help defray costs and the expenses associated with postage, printing, handling and mailing of paper documents. In turn, they may be encouraged to continue investing in and developing more efficient and useful delivery methods and more value-added participant services. As plan administration becomes more cost-effective, it is also likely that smaller employers — which typically have lower plan sponsorship rates — might be in a better position to provide a plan. Participants benefit from having a greater choice to select how, where and when they receive their information, without the delay associated with mailing. Finally, the environment benefits through less use of paper and the resources associated with transportation.
Certain regulations pose barriers and should be revised. DOL regulations today limit the use of e-delivery methods to only those individual plan participants who can access information from a system that is an integral part of their job, and from whom the provider can secure consent to receive the information electronically. In addition, the current ERISA electronic disclosure safe harbor imposes onerous email administration requirements and programming costs. Appropriate for 2002 when established, the safe harbor does not recognize advancements in technology that are readily available and being utilized by participants and beneficiaries today. Provisions such as these should be reviewed in the context of the latest changes and consumer trends.
Uniform standards should be developed. Differences exist between the DOL and the Internal Revenue Code (IRC) disclosure regulations which can lead to confusion. In some cases, federal securities laws and state laws may also need to be considered. ING encourages the DOL and IRS to work in tandem to develop uniform electronic delivery methods that strive to harmonize the different regulations between these two agencies, where possible.
Affirmative consent from a participant should not be required for establishing electronic delivery. ING strongly encourages the consideration of an amendment to permit electronic delivery of required plan documents and communications without affirmative consent.
A desirable method for “delivery” is to make documents continuously available online. ING advocates modifying the ERISA safe harbor provision by removing the impediment of securing worksite or participant email addresses and replacing it with the standard previously approved by the DOL in Field Assistance Bulletin (FAB) No. 2006-03. This guidance provides that continuous access to a plan’s website was sufficient for purposes of “delivering” a participant statement, which may be considered the most important regulatory document received by a plan participant. Under this standard, all regulatory documents would be made available to participants and beneficiaries on a continuous basis and accessible at any time. Participants would always have the option of opting out of electronic “delivery” and receiving paper documents.
ING is a global financial institution of Dutch origin offering banking, investments, life insurance and retirement services to over 85 million private, corporate and institutional clients in over 40 countries. With a diverse workforce of more than 105,000 people, ING is dedicated to setting the standard in helping our clients manage their financial future.
In the U.S., the ING (NYSE: ING) family of companies offers a comprehensive array of financial services to retail and institutional clients, which includes life insurance, retirement plans, mutual funds, managed accounts, alternative investments, institutional investment management, annuities, employee benefits and financial planning. ING holds top-tier rankings in key U.S. markets and serves approximately 20 million customers across the nation. For more information, visit www.ing.us.