Despite billions of pounds of contributions being paid into Defined Benefit (DB) pension schemes in recent years, for many schemes the deficit between assets and liabilities – or DB ‘Black hole’ - has continued to grow.
One of the ways to remove some or all of the risks associated with your DB scheme is to enter into an arrangement with an insurer for some or all of your DB liabilities.
Over the past five years, trustees and sponsors of DB pension schemes have insured pension liabilities worth more than GBP 90 billion through bulk annuity deals (buy-ins, buyouts and longevity swaps). In doing so, they have removed the investment and longevity risk associated with pension schemes and ensured that their scheme members receive the benefits on which they have based their retirement plans.
So, how would you gauge whether a bulk annuity deal or longevity swap is not only right for your scheme and its members but also an affordable option? That’s where we come in.