Author: Greg Winterton

UK-based industry group the Society of Pension Professionals (SPP) held an event last week that educated pension professionals with regards to preparing for a bulk annuity transaction.  During the event, the SPP asked the audience – numbering more than 200 – what proportion of their schemes they expected to complete a bulk annuity transaction over the next five years.  Some 54% said that around half would do so and a further 15% said that more than three-quarters of their schemes would do so.  Around a third (31%) of participants said that only a minority of their schemes would do so. “The number of pension…

Consulting and actuarial firm Milliman Inc.’s latest Milliman Pension Buyout Index (MPBI) shows that the estimated cost to transfer retiree pension risk to an insurer in a competitive bidding process increased from 100.3% of a plan’s accounting liabilities (accumulated benefit obligation, or ABO) to 100.9% of those liabilities. That means the estimated retiree pension risk transfer (PRT) cost is now 100.9% of a plan’s ABO. During the same time period, the average annuity purchase cost across all insurers in our index also increased, from 102.6% to 103.3%. The competitive bidding process is estimated to save plan sponsors about 2.4% of…

The US pension risk transfer (PRT) market delivered its largest first quarter on record, according to the latest quarterly Pension Risk Transfer Monitor from Legal & General Retirement America (LGRA). LGRA estimates that $15bn worth of transactions were completed between January and March this year, more than twice that seen in 2023 ($6.3bn) and three times greater than 2022’s $5.3bn. “Jumbo transactions continue to be the driving force behind the market’s strong performance. We saw two such transactions close in Q1 totaling $11bn,” says LGRA in this quarter’s report. LGRA expects total volume in H1 to come in at approximately $22bn, and the…

Legal & General has completed a c.£900m buy-in transaction with the ICI Pension Fund. The deal secures the benefits of over 7,000 retirees. This transaction – the 12th since the ICI Pension Fund entered into an umbrella agreement with Legal & General in 2014 – takes the total value to date to approximately £7bn, covering around 70% of the ICI Pension Fund’s total liabilities. “We are pleased to have deepened our relationship with the ICI Pension Fund in the most recent transaction,” said Andrew Kail, CEO at Legal & General Retirement Institutional. “It falls almost ten years to the day…

Actuarial advisory firm Actuarial Risk Management (ARM) has appointed Raghu Ramachandran as Director of its Life & Annuity insurance consulting practice. Ramachandran’s career includes roles as Head of Insurance Asset Channel at S&P Dow Jones Indices, Chief Investment Officer of a US multi-line insurance company, and an insurance portfolio manager and head of the portfolio strategy group at Brown Brothers Harriman (BBH). “Raghu and I crossed paths 30 years ago when I came to the US, and I have been continually impressed by his capabilities and insights into risk management for insurance company portfolios,” said Corwin Zass, Principal and Founder…

Metallus Inc has entered into an agreement to purchase a group annuity contract from The Prudential Insurance Company of America in connection with the termination of the TimkenSteel Corporation Retirement Plan (Salaried Pension Plan). The transaction settles approximately $121m of the company’s remaining US pension obligations. Prudential will pay future benefits under the group annuity contract starting August 1, 2024, for the remaining approximately 1,000 participants in scheme. “Prudential was carefully selected as a highly rated and experienced retirement benefits provider,” said Kris Westbrooks, Metallus’ Executive Vice President and Chief Financial Officer. “Following the Bargaining Pension Plan partial annuitisation in 2022, the…

PHL Variable Insurance Company (PHL) and its subsidiaries, Concord Re, Inc. and Palisado Re, Inc. have been placed into rehabilitation proceedings in Connecticut.  Insurance Commissioner Andrew N. Mais filed a Petition for Rehabilitation and Appointment of the Commissioner as Rehabilitator on Friday, May 17, which was granted yesterday.  The Connecticut Insurance Department (CID) filed the petition after “determining that the companies are in a hazardous financial condition and that other alternatives have been thoroughly explored.” “Today’s filing underscores the department’s commitment to protecting consumers and ensuring the availability of a financially sound insurance industry in Connecticut,” said Commissioner Mais.  “This action is a critical…

Total US individual life insurance new annualised premium slipped 1% year over year to $3.76bn in the first quarter, according to industry group LIMRA’s preliminary U.S. Life Insurance Sales Survey. The total number of policies sold also dropped 1% in the first quarter. “Overall, a large proportion of carriers reported gains in both premium (7 in 10) and policy sales (6 in 10) in the first quarter. Every product line except whole life posted positive growth,” said John Carroll, senior vice president, head of Life & Annuities, LIMRA and LOMA. “The industry must innovate to reach underserved markets and grow…

Asset manager Twelve Capital has bought back the 30% stake in the firm previously owned by Graubündner Kantonalbank (GKB). “We are very pleased to execute this transaction. The Twelve Capital team is excited by the prospects of the firm and fully committed to continue to deliver value to our clients,” said Urs Ramseier, Twelve Capital Executive Chairman. GKB originally bought the stake back in January 2022. 

European pharmaceutical company Norgine has insured the benefits of its defined benefit pension scheme with Canada Life in a full buy-in transaction of £28m. The transaction, which follows a competitive tender process run by Mercer, secures the benefits of 308 members, of which 152 are deferred members. “We are delighted the scheme chose us as their de risking partner, securing the benefits from both in payment and deferred members. We continue to focus on developing our capability to meet the growing market demand and enabling schemes and sponsors to secure the long-term future of their members with a financially strong…