Author: Greg Winterton

Contributing Editor

Post-pandemic, people across the world live eight months less and spend seven fewer months in good health, according to new findings by the International Longevity Centre UK (ILC). The organisation published the second wave of its Healthy Ageing and Prevention Index, which measures how well 153 countries across the world are ageing, looking at life span, health span, work span, income, environmental performance, and happiness. Comparing the latest 2022 data with 2019 data, ILC’s analysis across 153 countries finds that, on average, humans are living eight months less (life expectancy fell by 0.64 years from 73.1 years in 2019, to 72.5 years…

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Aviva has announced the completion of a £130m bulk purchase annuity full scheme buy-in with the Trustee of the Telereal Pension Plan1, which is sponsored by Telereal Services Limited. Aviva will insure the defined benefit liabilities for around 500 members. “We’re delighted the trustee selected Aviva to secure member benefits, and we’ll continue to work closely with them to ensure a smooth transition.  The process was well managed and completed quickly, thanks to all parties collaborating to reach a successful outcome.  We look forward to welcoming Telereal members as Aviva customers in due course,” said Sean Rooney, BPA Senior Deal Manager…

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Legal & General has completed a pension risk transfer buy-out with the Nortel Networks UK Pension Plan.  This deal is the third transaction between the two parties and insures the final tranche of Nortel’s plan members’ benefits. It consisted of a £14m initial premium and was followed by a £6m top-up on buy-out. Legal & General has now insured £2.5bn of the plan’s liabilities. The plan’s sponsor went into administration in 2009 and entered a Pension Protection Fund (PPF) assessment. While in assessment the plan was able to secure material additional funds from the Nortel insolvency process to improve member benefits. The…

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Higher interest rates around the world are transforming the outlook for life insurance growth and profitability, according to the Swiss Re Institute. In its new sigma study, ‘Life insurance in the higher interest rate era: asset-savvy is the new asset-light’, Swiss Re Institute forecasts an additional $1.5trn in global insurance savings premiums over the next decade, as consumers are moving to buy life-savings products that secure higher retirement incomes. As a result, total global premiums are forecast to grow to $4trn by 2034. In contrast, global life insurance premiums grew by only $300bn in the entire low interest rate decade…

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Preparation is the key for smaller defined benefit pension funds that are looking to insure their scheme members’ pension liabilities via a bulk purchase annuity transaction, according to consulting firm Aon. “The pension scheme risk settlement market is buoyant and, although there is some noise about small schemes being crowded out of the market by all the mega deals, this is not what we are seeing in practice,” said Joe Hathaway, Associate Partner in risk settlement at Aon. “In fact, there are increasingly more options and resources available for schemes that are under £150 million in size. This expansion in…

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Life expectancy underwriting firm Predictive Resources has promoted Roger Tafoya to President and Chief Underwriting Officer. Tafoya joined Predictive Resources in February 2019 as COO and Chief Underwriter. “Roger is everything we expected and more, and he has directly contributed to Predictive’ s ongoing success,” said Vince Granieri, CEO of Predictive Resources. Prior to joining Predictive Resources, Tafoya was Head of Underwriting New Business and Underwriting R&D for MassMutual, where he led ongoing development of algorithmic underwriting and partnered with clinicians, data scientists, vendors, underwriters, and claims professionals to use digital health data to improve mortality, morbidity and longevity accuracy for both pricing…

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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…

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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…

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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…

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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…

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