A strong fourth quarter propelled the US pension risk transfer market to its third strongest year on record, as $28bn in aggregate premium drove the 2025 total to approximately $49bn.
Aggregate premium gets the headlines in the PRT space, and so the $7bn sold in the first quarter might appear to be relatively derisory on the surface, but in terms of activity, the market remained robust as the 127 contracts sold in the first quarter were only 13% fewer than in the same period in 2024.
A couple of reasons might go some way to explaining why there was a pullback at the beginning of the year. The beginning of the year is typically slower in the US market anyway as completing a transaction before the end of the year increases cost savings for a plan sponsor; PBGC premiums are based on year-end participant counts which often leads to higher transaction volumes towards the end of the year which in turn tends to keep sponsors and intermediaries busy leading into the following year.
But also, in 2024 a handful of class action lawsuits accusing some companies of not selecting the safest annuity available likely gave some in the market reason to pause.
“It would be fair to say that corporations considering a jumbo ($1bn+) retiree-only transaction may have taken a wait and see approach following the lawsuits,” said Alex Gagnon, Vice President and Head of Distribution at insurer Banner Life.
“This would explain the lower premium volumes, though the number of transactions in early 2025 was relatively similar to that of 2024.”
Still, the market kept on keeping on and ended up with the bronze medal on the all-time aggregate premium table – an increasing percentage of which was the buy-in transaction.
Long a feature of the UK PRT market, this transaction type has, aside from a handful of transactions here and there, largely been absent from the US space, but has begun to gain momentum recently.
“Buy‑ins played an outsized role this year as many plan sponsors navigated elevated market and balance‑sheet volatility. In an environment of economic uncertainty, buy‑ins offered a more flexible, lower‑commitment path to de‑risking: they allowed sponsors to transfer asset and longevity risk to an insurer while maintaining plan administration and keeping liabilities on the balance sheet,” said Keith Golembiewski, Assistant Vice President and Head of LIMRA Annuity Research.
“In 2025, we saw more plan sponsors seek buy-in contracts to lock in rates and start the multiyear process of plan termination. This trend reflects both the maturity of the PRT market and the evolving ways sponsors are managing risk in today’s environment.”
Indeed, buy-in sales were a record-breaking $12.7bn in Q4 last year across seven contracts, a 600% increase on 2024. For the year, new buy-in premium totalled $17.5bn, up 372% from 2024 sales. US carriers reported 17 buy-in contracts in 2025, representing a 70% increase year over year.
This development is not a surprise to those in the market and therefore, not a one-off. Elevated activity in buy-in transactions is expected to be a feature of the industry in the US going forward.
“This is something we have been anticipating for a couple of years as plan termination volumes have continued to increase and sponsors have looked for ways to de-risk earlier in the plan termination process,” said Gagnon.
“We have historically seen a limited number of buy-ins in a given year but in 2025, we saw significant growth. 2026 indicates this trend will continue with 14 currently expected in the market with the expectation for 2026 to overtake 2025 as the year with the most buy-ins yet.”
Similar to its UK cousin, all signs point to 2026 being another year of robust activity.
Asset manager L&G’s Pension Solutions Monitor estimates the health of a typical US corporate defined benefit pension plan; last month, while the funding ratio dropped, largely as a consequence of the struggles of public equity markets, it remains above par at 104.7% (and has been above water every month in the past 12). Fully funded means ready to de-risk (financially, at least).
And there was also an increase in the number of deals coming from the mid-market in the US – plans between $100m and $500m in size, which broker Gallagher says “suggests a broader adoption of PRT strategies by a more diverse range of plan sponsors, perhaps driven by increasing financial sophistication and a greater understanding of the long-term benefits of de-risking.”
Add to those the demographic trends (more retirees, aging workers), a competitive insurer market and what seems to be stickier interest rates all provide tailwinds for the space.
Just expect to see buy-ins play an increasingly larger role.
“We are very confident that buy-in activity will continue to grow in 2026 and beyond, perhaps not in terms of premium volume since last year we saw a $10bn buy-in transaction, but definitely in terms of number of transactions,” said Gagnon.
“There are two factors driving this: first, expertise from intermediaries and the streamlining of the product, making it an easier to understand product, and second, the increased appetite from insurers as more insurers have now developed a buy-in product that can meet market needs.”
