2019 was a record year for bulk annuity insurers and the message to schemes could not have been clearer – pricing is very attractive. Covid-19 has created many challenges for DB schemes but, for those ready to transact in 2020, it may have created even more favourable market conditions for a buyout.
- ensuring the transaction is financially viable, which is where Covid-19 will have an impact
- precisely defining the liabilities which are being transferred from the scheme to the insurer.
Ensuring the finances work
Impact of Covid-19
Defining the liabilities
- performing detailed data cleansing
- auditing administration benefit calculations
- reviewing all the scheme’s legal documentation (historic and current) to ensure the rules have been correctly administered.
Getting your governance right
Resources and project management
- who will provide this resource?
- who does this resource report to and does that create any potential conflicts of interest?
- what is the role of advisers in meeting any resource needs (again this can create conflicts that need managing).
In the news this week, the Regulator publishes its strategy for the next 15 years and, along with the Pensions Minister, also focuses on superfunds, whilst the PLSA launches an initiative to help make climate-aware investment easier for schemes.
Journey plans or glide paths may have been around for a long time but they’re at the heart of the Regulator’s proposed new funding code. In this Pensions Perspective, Leonard Bowman looks at how long-term funding and investment plans are evolving and explains why companies are increasingly taking the lead in designing an endgame strategy for their schemes.
This quarter’s Arena has a summary of our recent Pensions Perspective, “Emerging from lockdown”, which looked at how best to tackle the most common pension issues which companies are currently facing. It also shows all the usual financial and investment analysis for the quarter ending 30 June 2020.
As we keep hearing, we are living in unprecedented times. However, as we turn our attention to the future, what does the “new normal” mean for defined benefit pension schemes? In this Pensions Perspective, Leonard Bowman considers the most common pension issues that companies are facing and how best to ensure that the company approaches these on the front foot.
Covid-19 has created many challenges for DB schemes but, for those ready to transact in 2020, it may have created even more favourable market conditions for a buyout. The problem is that most schemes are not there yet. In this Briefing we look at what being “deal ready” actually means and what work it will involve.