The new regulatory environment has resulted in institutions taking a closer look at their 403(b) providers and making the changes necessary to make sure they are well equipped to handle the administration of their plans, said John Begley, executive vice president of Fidelity.
The new regulations require a written plan document that highlights the number of vendors, investment options available and the ability to take loans and hardship withdrawals, among other plan design elements.
Fidelitys strong name recognition has helped it to capture assets from smaller providers, as well as its ability to offer plan sponsors record keeping, investment management, employee communication and education services.
Generally, institutions with more than half a dozen providers are moving to reduce the number of vendors they offer to just two or three, Begley said. Those that have limited investment offerings, like an annuity-only plan, are increasing the number of 403(b) providers to offer a broader set of investment options.
We are well-positioned to provide tax-exempt employers with the products and services they need to navigate the new regulatory requirements and strengthen their 403(b) plan offerings, he said.
