Bulk annuities latest: Construction group seals sub-£5m buy-in with Aviva

A Preston-based construction group has completed a full scheme buy-in with Aviva, part of a plan to buyout and wind up the defined benefit (DB) scheme.

John Turner Construction Group’s DB scheme is now fully insured, covering the benefits of one pensioner and 18 deferred members. The deal was completed in March 2024. The scheme had approximately £2.6m in assets as of 31 March 2023, according to the employer’s latest annual report.

Broadstone advised on the deal using its SM&RT Insure service, and also provided actuarial, administration and investment services to the scheme. In a statement, it said the transaction was completed without the need for additional cash from the sponsoring employer.

The deal made use of Aviva’s Clarity service, a streamlined bulk annuity offering that is designed to make it easier for small schemes to secure an insurance deal.

Michael Davies, chair of trustees, said: “When we understood we could purchase a bulk annuity with our available assets, we knew we had to take advantage and approach the market as quickly as we could.

“We’re pleased that Aviva were able to quote for our business and that Broadstone prepared us so well to complete the transaction quickly. We can now be satisfied that our members will benefit from the additional security provided by the insurance contract and proceed to wind up the scheme.”

Rathbone Group insures pension schemes in £100m transaction

Canada Life has insured members of two DB schemes sponsored by wealth management firm Rathbone Group in a deal worth £100m. The buy-ins for two schemes cover approximately 480 members.

Richard Lanyon, chair of the trustee board for both schemes, said: “It’s fantastic that we’ve made this step to further enhance the security of members’ benefits. The trustees and Rathbones have been cooperatively involved in the schemes’ de-risking journey in conjunction with our advisers. Seeing the results of this effort come to fruition is very rewarding.”

Iain Hooley, group chief financial officer of Rathbones Group, said: “We are very pleased to have worked closely with the trustees and advisers in fully securing the benefits of all members with a highly respected insurer. The support of Canada Life enhances the security already offered to scheme members and substantially de-risks the group’s balance sheet. We are grateful to the schemes’ trustees and all advisers for their efforts and attention to detail in achieving this outcome.”

Buck and Just help scheme secure £136m deal

Earlier this month, consultancy group Buck announced that it had helped secure a £136.6m buy-in with Just Group for an unnamed pension scheme.

The deal covers 586 deferred members and 242 pensioners and follows a previous buy-in with Legal & General that was completed in 2012.

Buck said the transaction included work to resolve liquidity issues through the use of deferred premiums, allowing the scheme to secure the deal while also allowing time to unwind illiquid assets.

The consultancy said £22m was to be deferred for two years and £4.5m for three months, allowing the trustee board and the sponsoring employer time to finalise a loan to help manage short-term liquidity requirements.

Mark van den Berghen, head of risk transfer at Buck, said: “This is an extra special transaction for me as I have been involved in the scheme for over 15 years. The outcome is a fantastic one for the members and hats off to all involved in not allowing the remaining illiquidity in the scheme to derail the transaction – all due to open communication, innovative consulting, and flexibility on both sides.”

Just Group reaches 400 transactions landmark

This week, Just Group announced that it had reached 400 bulk annuity transactions with DB schemes since it completed its first deal in 2013.

The insurer has completed deals worth more than £17bn in total over that period. It claims to have been responsible for approximately one in five of all de-risking transactions completed across the market over the past 11 years.

David Richardson, group CEO at Just Group, said: “We operate in a vibrant and competitive market with multiple insurers bidding for transactions. This helps ensure schemes of all sizes are well served by the market and completing 400 transactions is a marker of how well our service and proposition is meeting the needs of trustees, sponsors and members.”

The company has focused on the smaller end of the market, but last year completed its first deal worth more than £500m when it insured the GKN Group Pension Scheme.

Pretty Sagoo, managing director for DB solutions at Just Group, said: “We estimate that only 15% of defined benefit liabilities have been transferred to insurers via de-risking transactions since 2007. This market has significant headroom for growth and Just Group [is] well positioned to help large, medium and small schemes achieve their objectives.”