Browsing: Longevity Risk

£22m deal is Royal London’s tenth since entering the UK pension risk transfer market.

£270m deal is the third buy-in that Aviva has transacted with schemes sponsored by WM Morrison Supermarkets Limited.

BMO Insurance will issue annuities covering the responsibility for pension benefits of approximately 860 pensioners and beneficiaries.

£63m deal covers the pensions of all 570 members.

The Life Insurance Settlement Association ‘s latest Market Member Survey shows licensed life settlement providers delivered a six-times multiple over the cash surrender value to those who sold their policy last year.

There has been significant activity in bulk purchase annuity buy-ins in the UK in recent years, which at some point will need to move to buy-out so that the original scheme can wind-down.

The portfolio servicing component can have a significant impact on returns.

The bulk annuity market has high barriers to entry. Firms require significant long-term capital and specialist expertise, including asset sourcing, actuarial modelling and risk management, and regulatory approval is not straightforward.

For investors, the fundamental value proposition of lifespan-based financial products is simple: they have near-zero correlation to traditional market indices and the often-chaotic impulses of global markets.

Gareth Truran of the Bank of England’s Prudential Regulation Authority offers a regulator’s view of the UK bulk purchase annuity market.