Defined Contribution Retirement Plans Gaining Popularity, Building Digital Capabilities
Plan sponsors are investing in distribution, data and analytics, and core systems while meeting compliance standards and seeking new customers: Novarica
Boston, MA (Aug. 20, 2019) – Providers of defined contribution retirement plans are working to attract new clients while driving down costs. They’re also trying to retain existing clients and assets by improving their investment performance and insights being used. Achieving these goals means providers in this growing market are investing in digital capabilities and monitoring changing regulation. In a new report, Business and Technology Trends: Defined Contribution Retirement Plans, research and advisory firm Novarica provides an overview of defined contribution retirement plan provider business and technology issues, data about the marketplace, and 12 examples of recent technology investments by insurers offering defined contribution retirement plans.
“Although defined contribution plans were originally designed to complement more traditional defined benefit plan offerings, the reality for many plan participants is that defined contribution plans have now replaced their defined benefit counterparts,” said Nancy Casbarro, Vice President of Research and Consulting and co-author of Novarica’s new report. “Reducing operational back-office processing costs is key to carriers’ efforts to win new plan sponsors’ business while retaining existing plans. Having a clear strategy for this component of the technology roadmap is particularly important for carriers considering augmenting their organic growth plans with targeted acquisitions of other plan providers.”
Key findings of the report include:
- Plan sponsors continue to be concerned about compliance and financial wellness. Lawsuits over excessive investment fees continue, and ensuring employee financial wellness is of increasing concern to employers.
- Most carrier technology investment is in case installation and distribution. Onboarding requires investments in digital capabilities, data and analytics, and core systems.
- Portal initiatives and communications continue to be vital. A focus on participant financial wellness across the board requires effective communications as well as reporting and analytics.
- Regulatory changes will continue to impact the market. While the DOL best interest guidelines are all but gone, additional NAIC, SEC, and state regulations will replace them.
A preview of the report is available online.
Summary
Plan providers are focused on driving down costs and attracting new clients, all while retaining existing clients and assets through improved insights and investment performance.
This report provides an overview of defined contribution retirement plan provider business and technology issues, data about the marketplace, and 12 examples of recent technology investments by insurers offering defined contribution retirement plans.
Topics:
- Recent market and financial trends;
- Active insurer landscape;
- Technology issues, priorities, and examples by functional area;
- Top technology priorities for 2019 and beyond.
Click here for the table of contents or to access the report.
About Novarica
Novarica helps more than 100 insurers make better decisions about technology projects and strategy through retained advisory services, published research, and strategy consulting. Its knowledge base covers trends, benchmarks, best practices, case studies, and vendor solutions. Leveraging the expertise of its senior team and more than 300 CIO Research Council members, Novarica provides clients with the ability to make faster, better, more informed decisions. Its consulting services focus on vendor selection, custom benchmarking, project checkpoints, and IT strategy. For more information, visit www.novarica.com.
Source: Novarica
Tags: Novarica, retirement planning & savings, technology investment, trends Read the original article at Insurance-Canada.ca