Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
Quick links:
  • Home
  • The Actuary Issues
  • November 2018
11

Record year predicted for bulk annuity market

Open-access content 14th November 2018

The value of bulk annuity transactions in the UK for 2019 is likely to be even higher than the record breaking total set this year, new research has found.

2


In a report published yesterday, Hymans Robertson said the transaction value for pension scheme buy-ins and buy-outs should exceed £20bn by the end of the year.

The consultancy also expects each of the eight insurers active in the bulk annuity market to have had a record 12 months for transaction volumes this year.

And these firms have good reason to expect similar activity in 2019 after a survey of independent trustees found that 100% believe next year will see even more bulk annuity volumes.

Competitive pricing from insurers and surging pension scheme demand, driven by improved funding levels and improved risk management, are thought to be behind the findings.

"Insurers now have the luxury to be more selective about which pension schemes they focus their efforts on," Hymans Robertson head of risk transfer, James Mullins, said.

"For the first time in the market's history, a queue for 2019 is already forming, and the onus is now with pension schemes to stand out from the crowd."

Mullins added that 2019 would see "the busiest start to a year for buy-ins and buy-outs" as pension schemes rush to complete transactions before the Brexit deadline in March.

Hymans Robertson said it is increasingly common for schemes to be able to afford to insure all of its pension promises, and fully pass the responsibility of paying members on to insurance firms.

The cost of insuring the benefits of younger members has also got much cheaper, with several insurers believing these transactions offer a good balance for investment strategies and risk appetite.

Looking ahead, Mullins said "excellent" buy-in pricing would continue in 2019, and that pension schemes would have to adopt more intelligent approaches when broking the market. 

"It is now more important than ever for trustees to be well prepared and to have a clear understanding of insurance companies and how they prioritise their efforts," he continued.

"Timing the approach, to factor in the latest activity levels, and not trying to rush through a transaction, is also critical." 


Sign up to our free newsletter here and receive a weekly roundup of news concerning the actuarial profession

This article appeared in our November 2018 issue of The Actuary.
Click here to view this issue
Filed in:
11
Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Senior Pricing Actuary

London (Central)
£95000 - £120000 per annum + benefits
Reference
118966

Senior Longevity Actuary – Reinsurance

London (Central)
£100,000
Reference
118949

Senior Capital Actuary

London (Central)
£90000 - £110000 per annum + + bonus + benefits
Reference
118965
See all jobs »
 
 
 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2020 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited, Level 5, 78 Chamber Street, London, E1 8BL. Tel: 020 7880 6200