Legal & General (L&G) has completed the biggest defined benefit pension scheme buy-in so far this year, insuring a section of the UBS UK Group Pension Plan for £1.7bn.
The transaction covers more than 7,000 members of the scheme’s UBS Section, and includes the conversion of a longevity swap struck with Zurich in 2020.
The deal also follows a £900m buy-in with the Credit Suisse section of the scheme, completed in 2024.
According to a press release from L&G, the UBS scheme adjusted its investment portfolio to align with an insurance transaction before approaching the market, while the trustee board also carried out “significant” work to prepare its data for the buy-in.
Ralph McClelland, partner at Sackers, which provided legal advice to the trustee board, said: “The successful conclusion of this phase of the project is the product of many months’ work. The terms, which included carefully negotiated, bespoke provisions and the restructuring of an existing longevity swap, represent an excellent outcome for all parties.”
John Baines, a senior partner at Aon, the lead adviser on the buy-in, added: “The transaction was structured to preserve many of the features that members value most, highlighting how the insurance market can deliver strong outcomes for schemes and members alike.”
Chris Martin, chair of the UBS UK Group Pension Plan and a trustee director at Independent Governance Group, said the buy-in was “a major milestone” as the whole scheme was now insured.
Separately, this week Royal London announced a £40m buy-in with the Metallus UK Pension Scheme, sponsored by steel manufacturer Metallus.
The deal insures 493 members. Isio was the risk transfer adviser, while BESTrustees was the scheme’s professional trustee. Gowling WLG provided legal advice to the trustees.
Kenny Wilson, deal lead at Isio, praised the “strong collaboration” between the trustees, employer, Royal London, and other advisers.
