The Secure Family Futures Act, reintroduced in both chambers of the U.S. Congress, would allow life insurers to treat debt investments, such as bonds, under ordinary tax rules.
Currently, these investments are taxed under capital gains regulations, according to a joint statement from Senator Thom Tillis (R-NC) and Senator Raphael Warnock (D-GA).
The bipartisan legislation was previously introduced in the House in 2023 and again in the Senate in 2024 but did not advance past committee, according to legislative records.
If passed, the bill would apply consistent tax treatment to insurers’ bond investments. Tillis stated this change would support investment and economic development across the country, including in North Carolina.
In a letter to Congress, Kenneth LaGuardia, Global Tax Director at MetLife, pointed to the nearly $290 bn life insurers invest in agricultural loans and infrastructure projects like bridges and ports as evidence of the industry’s ongoing financial commitment within the U.S.
David Chavern, president and CEO of the American Council of Life Insurers, noted that life insurers have invested $8 tn in businesses, infrastructure, and employment nationwide.
He added that the returns from these investments help individuals and companies access necessary financial protection.
And the returns from these investments help families and businesses access the financial protection they need to succeed and thrive.
David Chavern, president and CEO of the American Council of Life Insurers
“Senator Tillis’ and Senator Warnock’s bill offers much needed changes to the tax treatment of life insurers’ bond investments that will foster further economic growth and help more people and businesses secure their financial futures,” David Chavern said.
Chavern supported the proposed legislation, stating it would improve tax policy for bond investments and support broader economic activity.
In a move that signifies bipartisan efforts to revamp the U.S. tax system, Senators Thom Tillis of North Carolina and Raphael Warnock of Georgia have joined forces to introduce the Secure Family Futures Act, targeting an overhaul of capital tax treatment for life insurers and their debt investments.
The bill, as detailed by Senator Tillis’s office, aims to upend the current tax structure that’s been branded as outmoded, applying an ordinary tax treatment to bonds held by life insurers instead.
“This commonsense legislation ensures debt investments made by insurance companies are treated equally under our tax code” Senator Tillis explained, pointing to the potential for this change to stimulate both economic growth and investment across the country, but it’s important to note, the specifics of this ‘commonsense legislation’ have not yet been fully laid out in broad public view.
Senator Warnock, known for blending his advocacy with his ministry, stresses the importance of affordability and access to the financial safety net that life insurance represents.
“Life insurance provides peace of mind, and we should make that peace of mind more accessible and affordable, especially when there’s a commonsense fix in our tax code,” he told Senator Tillis’s office.
