XPS Bulk Annuity Market Tracker
The XPS Bulk Annuity Watch tracker allows you to view the bulk annuity transactions completed by each provider since 2007, by number of deals and volume of premium.
Over recent years there has been a significant increase in bulk annuity transactions for defined benefit pension schemes as funding levels have significantly improved.
The XPS Bulk Annuity Market Tracker, called XPS Bulk Annuity Watch, allows you to customise the chart by selecting what you want to see, including filtering by insurer volume and by type of deal (e.g. pensioner only buy-ins, full scheme buy-ins and superfund transactions etc).
The chart is updated regularly as new deals are publicised and insurers release details of half and full year volumes through their regulatory returns.
Source: XPS Group.
- The charts above should not be relied upon for detailed advice or taken as an authoritative statement of the law.
What are bulk annuities?
A bulk annuity is an insurance policy which is purchased by the trustees of a pension scheme. This policy transfers the key risks of Defined Benefit (DB) pension schemes to an insurance company, who will then be responsible for the payments made to members.
Bulk annuities definitions
There are two different types of transactions often referred to in the industry: buy-ins and buy-outs. In very simple terms a buy-in is a policy owned by the trustee and held as an asset of the scheme. In exchange for a premium, the insurer will pay the scheme a payment each month to cover the insured pension payroll who in turn makes this payment to members. Members tend to see very little difference in the way in which their benefits are administered.
Lots of pension schemes however chose to convert these “buy-ins” to buyout. This includes transferring the full administration and full responsibility to the insurer. Members are no longer members of their DB scheme and instead become policyholders of the insurance company. At this stage, the insurer takes full responsibility for interactions with members, including communicating with members and making payments direct to members and their dependants as they fall due.
Our approach
We build partnerships based on trust and transparency. We believe that honesty and open communication are the key pillars of a successful business relationship, as it allows us to work together with our clients and develop tailored solutions that meet their needs.
Our experienced team works hard to provide accurate and up-to-date information, and by utilising our award-winning technology we are able to work with clients to come to a tailored solution. Our trackers and technology can benefit schemes of all sizes, providing useful insights to both pension trustees and corporate sponsors. If you’re interested in learning more, contact us to see how we can help.