PlanFacts

Qualified Plan Cross-Selling and Its Impact on Fiduciaries
 

Jun 20, 2019

It is no secret that retirement benefit plan cost structures have been under intense scrutiny in recent years. Across the board, plan fees have seen a marked decrease which is positive for plan participants and their retirement savings. With these fee compressions, retirement industry service providers with multiple financial services business units have been searching for alternate revenue streams to fill the void. Plan fiduciaries need to evaluate and understand what is being done with plan participant data, as well as the solicitation practices associated with these non-plan products and services.

Examples of non-plan services may include: retail investment products, annuities, insurance, banking products, along with other financial or non-financial services. These products generally provide higher profit margins than revenue generated solely from retirement plans. The reason this should be concerning to plan sponsors is that participants often view services offered under the retirement plan service provider’s brand umbrella as implicitly endorsed by the employer.
   
There is no doubt that participants need help with managing their retirement savings and value may be derived from these products and services. However, as with most ERISA best practices, plan fiduciaries need to evaluate and understand the service provider’s policies and potential uses of participant data as well as the solicitation practices associated with these non-plan products and services.

To learn more about how Newport Group can support you and your clients in this area, please contact your Newport Group representative.

​To download a copy of this article click here.

For informational use only.
20190620-877809-2644483

 

Unauthorized access is prohibited. This site is designed for U.S. residents only.
Newport Group, Inc. and its affiliates provide recordkeeping, plan administration, trust and custody, consulting, fiduciary consulting, insurance and brokerage services. Fiduciary consulting services are provided through Newport Group Securities, Inc., an SEC-registered investment adviser and FINRA-registered broker-dealer, and Newport Group Consulting, LLC, an SEC-registered investment adviser. Newport Group Securities, Inc. and Newport Group Consulting, LLC are affiliates of Newport Group, Inc. All securities transactions are provided through Newport Group Securities, Inc., in its role as broker-dealer. All fiduciary consulting services are provided through the registered investment advisers. When offering variable insurance products, Newport Group Securities, Inc. acts solely in its capacity as a broker-dealer. Trust and custody services provided by Newport Trust Company, a New Hampshire state chartered trust company and wholly owned subsidiary of Newport Group, Inc.