Bulk annuity market capacity and pricing dynamics could shift in the months ahead as larger pension schemes seek to tap the insurance market, according to Standard Life.
Insurance market movements in the first half of 2026 – and much of 2025 – were defined by a large number of smaller defined benefit (DB) schemes completing buy-ins, according to multiple data sources. The number of transactions has increased year-on-year substantially while total deal volume has dropped slightly, indicating a significant skew towards smaller pension schemes.
However, Claire Altman, managing director for pensions risk transfer and individual retirement at Standard Life, said the attractive insurance market for small pension schemes may become restricted once larger schemes start transacting.
“The return of larger schemes has the potential to play a role in shaping insurer capacity and pricing.”
“The timing of these transactions could have a significant impact on total market volumes for 2026 as well as pricing dynamics,” Altman said. “The return of these larger schemes has the potential to play a role in shaping insurer capacity and pricing. It remains to be seen how long favourable supply and demand dynamics will persist.
“For those schemes looking to seize the market opportunity in the near term, preparation and readiness will be key.”
Standard Life has forecast total bulk annuity volumes of between £35bn and £40bn for 2026, amid a “divergence” of approaches among DB schemes. While some will be ready for a bulk annuity deal, others have paused to assess their options in light of new capabilities emerging from the Pension Schemes Act.
Altman warned that there was little detail on how various options would work in practice, particularly regarding the use of surplus. She highlighted that “even for well-funded schemes, what appears as surplus today may act more as a buffer against future volatility than genuinely excess capital”.
Other regulatory developments, such as the government’s planned review of flexible apportionment arrangements following the Aberdeen-Stagecoach deal, could strengthen the appeal of “established routes such as buy-in and buyout”, Altman contended.
“Overall, the key trend shaping the UK [bulk annuity] market in the second half of the year will be the choices individual schemes make, as trustees either move ahead with transactions or wait for greater regulatory clarity,” Altman concluded.
“Schemes that are already committed to their endgame strategy and well prepared to proceed are likely to be in a strong position to act. With favourable pricing and strong insurer appetite, there remains a clear window of opportunity for those ready to transact.”
Trio of small deals announced
Meanwhile, three transactions have been announced in the past fortnight for schemes with less than £200m in assets.
Aviva has insured the Stantec Pension Plan through a buy-in, covering 680 members. The pension scheme is sponsored by Stantec, an engineering and architecture company.
The transaction involved converting a legacy insurance contract held by the scheme that had “valuable guarantees” but was not serving the members well enough, according to lead adviser Broadstone. According to Stantec’s latest annual report, the pension scheme had £152m in assets and a surplus of more than £30m.
Broadstone said the Stantec Pension Plan trustees – led by James Duggan of professional trustee firm Vidett – had focused on “member experience and robust procedures” when selecting an insurer.
Duggan added: “The insurer selection meetings were a crucial part of our process to choose the right insurer. We prepared and identified the characteristics to put our members at the very top of our priorities, and by selecting Aviva we have chosen to partner with an insurer that we felt would best deliver great member outcomes.”
Separately, Aviva and Broadstone also worked on a £5m buy-in announced earlier this month for the STS Field Grant Limited Pension Scheme, sponsored by pyrotechnics specialist Key Technologies. The buy-in covers 48 scheme members.
Paul Donnelly, bulk annuity senior deal manager at Aviva, said: “This transaction demonstrates that schemes of all sizes can successfully access the bulk annuity market and achieve a positive outcome for their members.”
Finally, K3 Advisory has helped complete an £11m buy-in for the Chartered Institute of Procurement and Supply Pension Scheme with Just Group. The deal was completed around six months after K3 was appointed by the scheme’s trustees.
The deal insures the benefits of 24 deferred members and 59 pensioners, according to an announcement from K3 Advisory.
Richard Williams, professional trustee at Capital Cranfield, which was the sole corporate trustee for the scheme, said: “The successful completion of this buy-in reflects the value of a well-coordinated and efficient approach between the trustee and advisers. Despite a highly active market, the scheme was able to secure members’ benefits with a competitive insurer solution and move quickly to complete the transaction.”
Thomas Crawshaw, senior actuarial consultant at K3 Advisory, said the speed of the transaction “demonstrates how smaller schemes can achieve efficient and successful outcomes in a busy market”, and praised the trustees’ “focused process”.
