SECTION 55. Annuity contract, custodial account or other investment for hospital employees

Any city through an officer designated by the city council or any town through an officer designated by the selectmen which operates a hospital may enter into a written agreement with such hospital employees to purchase or make payments to an individual or group annuity contract, custodial account, or any other investment authorized under section 403(b) of the Internal Revenue Code for such employee; provided, however, that in no event shall the total of the premiums paid for the purchase of any such annuity, custodial account, or other investment and the employee's includible compensation for any year exceed the total annual salary or compensation under the existing salary schedule or classification plan applicable to such employee in such year. As used in this section, the words ''includible compensation'' shall have the same meaning as in said section 403(b) and the word ''premiums'' shall include contributions paid to any such custodial account or other investment. Such employee's rights under such annuity contract, custodial account or other investment shall be nonforfeitable. Such contract shall be purchased only from an insurer authorized to issue life insurance or annuity contracts in the commonwealth; any such custodial account or other investment shall be purchased only from a company or corporation authorized to sell such other investments in the commonwealth; provided, however, that any such city or town may agree with any such employee or prospective employee who has an annuity contract, custodial account or any such other investment in force for at least ninety days prior to the effective date of such agreement to continue to make premium payments under such contract, account or investment subsequent to the effective date of such agreement, without regard to whether or not such contract, account or investment has been issued or sold by an entity authorized to issue or sell such contracts, accounts or other investments in the commonwealth, but in such case any subsequent contract shall be purchased only from an insurer authorized to issue life insurance or annuity contracts in the commonwealth, and any such custodial account or other investment shall be purchased only from a company or corporation authorized to sell such accounts or other investments in the commonwealth. Upon execution of such an agreement, the officer of the city or town thereunto authorized shall forthwith give written notice thereof to the treasurer of such city or town and shall certify the amount and dates of premiums payable under the terms of such contract, account or investment, the name of the issuing insurer or selling company or corporation and the office to which such premium payments shall be made. Said treasurer shall thereafter make such premium payments while such contract, account or investment is in force and such employee is actively employed by the city or town and, upon written notice duly given by said officer, shall make any changes in the manner or amount of premium payments required under the terms of any subsequent agreement, contract, account or investment entered into by such employee and the city or town and shall stop such premium payments when so notified by such officer. Such city or town shall not offer to such employee any such annuity plan, custodial account or other investment to the exclusion of any other plan, custodial account or other investment, whether group or individual.