Administration March 3, 2007

Study: Annuities Add Value to Retirement Plans

March 15, 2006 (PLANSPONSOR.com) - A study from the National Association for Variable Annuities (NAVA) assesses the value annuities provide when held in qualified retirement plans.
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In its press release, NAVA said the study found financial advisors feel it is the combination of income guarantees and insurance benefits that annuities provide that is driving their clients to include annuities in qualified plans or IRAs.

Seventy percent of survey respondents cited the death benefit and 61% listed living benefits among the top three reasons for recommending annuities in qualified plans or IRAs, according to the release. Guaranteed lifetime income was cited by 66% of respondents as one of the top three reasons.

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According to the study 42% of annuities sold by the respondents were placed into qualified plans. For the industry as a whole, approximately 60% of all annuity sales in 2004 were in qualified plans.

“Because so many people keep the majority of their retirement savings in qualified plans or IRAs, taking advantage of the asset protection annuities offer and the peace of mind they provide may make sense for many Americans,” said Mark Mackey, president and CEO of NAVA, in the release.

NAVA research and publications are available to purchase at  www.navanet.org .

Products March 2, 2007

IBM, Mercer Partners in HR Services Deal with American Airlines

March 2, 2007 (PLANSPONSOR.com) - Computer services giant IBM and Mercer HR Services are partnering to deliver a variety of Business Transformation Outsourcing (BTO) services to American Airlines.
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The 7 1/2-year, $217 million contract with the air carrier announced Friday will allow American to transform and manage many of its human resources functions, according to a news release announcing the deal. Mercer’s share of the contract is about 40%.

With the agreement in place, American will be able to use IBM’s suite of automated services and Mercer’s administrative and consulting offerings in delivering services to its 88,000 workers in the U.S. and Canada.

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The news release said as part of the agreement, IBM will provide American support for standardized human resources processes including training, recruitment and staffing and HR-related information technology and call center support.

Further, Mercer will deliver health and benefit, pension plan and compensation administration, in addition to health and benefit and employee communication consulting services.


“Through our agreement with IBM, we’re acquiring state-of-the-art tools and processes that will enhance our employees’ access to and use of HR services,” said Jeff Brundage, Senior Vice President-Human Resources, American Airlines, in the announcement. “Moving the transactional work to IBM allows us to focus our energies and resources on our strategic business imperatives.”

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