University of Missouri System

Collected Rules and Regulations

Financial Management

Chapter 140: Investments

140.050 Tax Deferred Annuity 403(b) Program

Executive Order No. 27, 3/28/94. TDA-1 Effective 8-1-95; TDA-2 Effective 1-1-97; TDA-3 Effective 9-1-00.

For the purposes of this section, the term annuity shall mean both tax deferred annuities under Section 403(b) of the Internal Revenue Code as well as custodial mutual funds under Section 403(b) (7) of the Internal Revenue Code.

1. Purchasing Annuities -- The University shall purchase annuities for all of its employees in accordance with the Internal Revenue Code. Such companies as meet the requirements in paragraph B, below, and which are designated by the Vice President for Human Resources of the University as a company from which annuities may be purchased, are designated as the only companies from which said annuities are to be purchased.
    
2. Requirements -- Requirements which each company must meet in order to sell and maintain annuities.
   1. That no such annuity agreements shall provide for incidental insurance.
   2. That any company which is incorporated or otherwise qualified under the laws of the State of Missouri and who qualify with all other provisions of the application be considered qualified.
   3. At the time of its initial participation in the plan, the company must agree in writing with the University to abide by the following additional requirements and must, at all times during its participation in the plan, meet the following additional requirements:
      1. The company will submit to the University such evidence as the University may require to show that the annuity or annuities sold by the company under the plan meet all of the requirements of the Internal Revenue Code for the tax treatment contemplated by the plan.
      2. The company shall promptly supply to the University such information as the University may request from time to time.
      3. The company will designate one person to be the representative of the company in connection with all annuities purchased from the company by the employees of any of the various campuses of the University and that such representative will serve as the contact between the University and the company in relation to all matters concerning the annuities purchased from the company including the initial establishment, the premium billing and payment, and the servicing of each such annuity.
      4. The company will maintain a local agent or agents in the vicinity of each of the campuses of the University and will keep on file with the University the names and addresses of the agents serving each campus and/or the company will maintain on file with the University all telephone numbers to be used by employees in making inquiries or initiating transactions on their annuities.
      5. The company will comply with all University regulations on sales and solicitations on University campuses in connection with the sale of all annuities under this plan. The company may conduct educational sessions on University campuses at any location which, in the normal course of University business, is made available for rent or lease to the general public. Such sessions are limited to focusing on general information regarding tax deferred annuities under Section 403(b) of the Internal Revenue Code investment strategies and personal financial planning. Such sessions should not be conducted in such a manner in which they would be considered sales solicitations.
      6. The company will not use any pressure tactics in the sale of any annuities on any campus and will not bring to any campus agents from other locations nor any temporarily enlarged sales force for the purpose of carrying on any type of special sales campaign.
      7. All annuities sold by the company under this plan shall provide for a premium of at least twenty-five dollars per month or three hundred dollars per year.
      8. Effective January 1, 1994, upon initial application for participation in the plan, the company shall have in force or have pending applications for either (1) annuities for at least 50 University employees or (2) annuities for University employees with a combined total of at least $5,000.00 in monthly premiums. To continue as a designated company from which annuities may be purchased under the plan the company must maintain either (1) annuities purchased by at least 50 employees of the University or (2) annuities for University employees with total monthly premiums of at least $5,000.00 and if, on January 1 of every year after the initial application, the annuities of the company are insufficient to meet at least one of these requirements and remains in that status as of December 1 of such year, then all annuities with the company shall cease to be a part of the plan as of December 31 of such year; provided, however, that no annuity shall be removed from the plan under this requirement until it has been in force for at least one year.
      9. Those companies who are approved and participating in the Plan as of December 31, 1993 must meet all provisions of the Plan.
      10. The company agrees to and will abide by such further regulations and requirements as may from time to time be added hereto by the University.
      11. The University shall have the sole authority to determine whether or not the company meets and complies with all the requirements set out herein.
      12. Every insurance, annuity, or pension company must have an A- or better rating by the A.M. Best Company. If a company's rating falls below A-, each University employee who is currently depositing funds with the company must be notified immediately. No employee will be allowed to initiate new salary reduction agreements with the company until its rating has returned to A-. The A- rating represents companies who have excellent overall performance with a strong ability to meet obligations over a long period of time.
      13. Every company offering mutual funds must provide at least four investment options to include: a Growth Fund, an Income & Growth Fund, an Income Fund, and a Money Market Fund, or their equivalents.
      14. The total of all investment, custodial, administrative, transaction, surrender, withdrawal, and any other charges, shall be presented to University employees in a complete, fair, and accurate manner.
3. Authority -- The Vice President for Human Resources as authorized representative has authority to effect for and on behalf of the Curators of the University all applications and instruments necessary and incident to the purchase of such annuities.