DOL reverses course on repeal of DC annuity safe harbor 

Citing “significant adverse comments,” the Department of Labor (DOL) has withdrawn a rule that would have repealed the agency’s annuity selection safe-harbor regulation for defined contribution plans. Had the regulatory safe harbor been repealed, fiduciaries would have been able to rely only on the similar — but not identical — statutory safe harbor added by the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019.

Comment letters opposing the regulation’s repeal focused on the differences between the two safe harbors, noting that the regulatory safe harbor covers the selection of both the insurer and the contract, while the statutory one covers only the selection of the insurer. Commenters also indicated that some fiduciaries are uncomfortable relying on the statutory safe harbor without an accompanying DOL regulation. The letters supported maintaining the regulation to let fiduciaries determine which safe harbor best suits their needs.

DOL has also withdrawn a rule that would have repealed a decades-old regulation that only applies to certain insurance policies and contracts issued to employee benefit plans before Jan. 1, 1999. Commenters indicated that the regulation is still needed because — contrary to what DOL had assumed — a number of retirement plans still have these policies. However, DOL didn’t withdraw its rule removing three obsolete interpretive bulletins issued soon after ERISA’s enactment, which will take effect Sept. 2.

• Selection of annuity providers — safe harbor for individual account plans — withdrawal (Federal Register, Aug. 12, 2025)
• Removal of definition of “Plan Assets” — insurance company general accounts — withdrawal (DOL, Aug. 12, 2025)

• DOL sails on from DC annuity safe harbor in deregulatory push (July 30, 2025)