The Royal Mail Pension Plan has agreed a £450m bulk annuity transaction to insure the liabilities of its Post Office Limited section.
The deal with Rothesay Life, which mainly covers deferred members, covers all pensions accrued from 2012 for Post Office defined benefit members. Pensions accrued before 2012 are guaranteed by the UK government.
The scheme had signalled its interest to insurers as early as 2016, which advisers said enabled attractive assets to be found. The premium was also locked to the value of a portfolio of gilts, meaning the cost to the scheme stayed stable throughout the deal.
Joanna Matthews, independent chair of the Royal Mail Pension Plan, said: “This is an important step in improving the security of Post Office workers’ pension benefits.”
The trustee was advised by LCP, Sackers and Arc Pensions Law.
