New Retirement Bill Expands 403(b) Fund Menu

However, an unregistered insurance company separate account remains under the Securities and Exchange Commission's oversight and enforcement.

"The bill would only provide for unregistered insurance company separate account products to be exempted from registration to be offered in 403(b) plans, just as they are now permitted to be exempt from registration in all other retirement [plans], such as 401(k) 457(b) and the federal Thrift Savings Program," IRI explained.

Bringing Parity to Retirement Plans

"These exemptions do not currently apply to 403(b) plans largely because 403(b) plans previously were offered as retail products sold directly to retirement savers at applicable organizations," IRI said. However, such plans are becoming increasingly available as institutional arrangements managed by a professional.

The Setting Every Community Up for Retirement Enhancement (Secure) 2.0 Act cleared the way for authorizing the use of CITs and unregistered insurance company separate accounts in 403(b) plans, IRI said.

However, "without enacting the changes to federal securities law included in the new legislation, those saving for retirement through a 403(b) retirement plan will continue to face a disparity with participants in 401(k) and all other retirement plans," IRI said.

"This is commonsense, bipartisan legislation to benefit millions of teachers, hospital workers, clergy and non-profit employees participating in 403(b) retirement plans," Richman said. "We look forward to working with them to pass this important retirement security legislation on the House floor."