Judge Sides With Principal Life Insurance in GIC Lawsuit
A federal judge found Principal’s ‘meticulous’ process for setting the GIC’s composite crediting rate protected the availability of the investment and was in the best interest of participants.
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Following a six-day trial, Judge John A. Jarvey of the U.S. District Court for the Southern District of Iowa ruled in favor of Principal Life Insurance Co. in a lawsuit alleging it violated the Employee Retirement Income Security Act (ERISA) by setting the crediting rate for a guaranteed investment contract (GIC) such that it could “retain unreasonably large and/or excessive profits.” A GIC is a stable value investment contract issued by an insurance company that usually pays a specified rate of return for a specific period of time, guaranteeing principal and accumulated interest.
Suit targets Principal Life Insurance over fees, performance
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A former participant in a 401(k) plan run by Principal Life Insurance Co. sued the company and plan fiduciaries, alleging ERISA violations in it and another 401(k) plan administered by Principal.
The primarily allegation is that Principal loaded the investment menus of both plans the choices are almost identical with proprietary products instead of checking if non-Principal products were better performing and less expensive, said the complaint filed Feb. 12 in a U.S. District Court in Des Moines, Iowa. Principal and its managers on the plan committees chose and maintained for the plans Principal investment products and plan administrative services with high fees, said the complaint, which seeks class-action status, in the case of David J. Hastings vs. Principal Life Insurance Co.
Self-Dealing ERISA Suit Targets Principal Insurance Co.
The lawsuit suggests the defendants chose and maintained Principal investment products and plan administration services because Principal, its subsidiaries and its officers benefited financially from the fees.
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A new Employee Retirement Income Security Act (ERISA) lawsuit filed in the U.S. District Court for the Southern District of Iowa accuses the Principal Life Insurance Co. of committing various fiduciary breaches in the operation of two retirement plans open to its own employees.
Also named as a defendant in the case are the retirement plans’ investment and administrative committees. The allegations against the defendants fit into the mold of similar self-dealing suits that have been filed against national financial services providers in recent years.
Philips North America buys group annuity to transfer some pension liabilities
Bloomberg
Philips North America LLC, Cambridge, Mass., purchased group annuity contracts from Metropolitan Tower Life Insurance Co. and Principal Life Insurance Co. to transfer the liabilities of certain pension plan participants.
Met Tower Life is guaranteeing 75% of participants benefits and Principal is guaranteeing 25% of benefits, according to a Feb. 11 letter to participants obtained by
Pensions & Investments.
Met Tower Life, a MetLife subsidiary, will be lead administrator and will begin sending participants their monthly benefits March 1, according to the letter.
The letter said Philips selected the two insurers based on their financial ratings, customer service, experience and reputations.
Southern Dallas FedEx shipping hub sells to NY investor
Trammell Crow Co.’s Cedardale Distribution Center is the latest to sell.
Trammell Crow built the Cedardale Distribution Center in southern Dallas in 2018.(Trammell Crow Co. )
A southern Dallas shipping hub is the latest North Texas industrial property to be snapped up by investors.
The Cedardale Distribution Center near Interstate 20 is more than 776,000 square feet and is leased to FedEx as a package-handling center.
An investor represented by New York-based Global Securitization Services LLC just purchased the big warehouse which was constructed in 2018 by Trammell Crow Co. and Morgan Stanley.
The distribution building is the first phase of a 106-acre, 1.5 million square foot business park Crow Co. plans near Bonnie View Road.