Our Pensions Derisking Group is at the forefront of devising and implementing structures which enable the transfer or limitation of defined benefit pension liabilities, and related assets, acting for scheme sponsors, trustees, insurers and reinsurers.
These are complex transactions with significant reputational and financial risk. Our strengths and experience as a multi-disciplinary commercial law firm are very well suited to their structuring and execution; we bring a robust and independent voice to the adviser team.
- Many different factors influence the decision as to the right structure, the right ingredients for that structure, and the right counterparties, including: price, timing, the insurer’s requirements, trustee risk appetite and the risks being mitigated, be it longevity risk, interest and inflation, investment risk, or a combination of these.
- We are leaders in the areas of scheme buy-outs and buy-ins, longevity hedging and reinsurance and portfolio transfer and optimisation.
- We have a deep understanding of liability transfer, what this entails, and its limitations.
- We also have a market-leading insurance practice and routinely advise insurers on Solvency II optimisation work, including in relation to matching adjustment-compliant structures in respect of their existing portfolios. We have published a market-leading guide to Solvency II.
Advising Akzo Nobel/ICI on ICI Pension Fund’s £3.6 billion buy-in deal with Legal & General and Prudential.
Advising Aviva on the derisking of the Aviva Staff Pension Scheme by way of an approximately £5 billion longevity hedge transaction involving insurance and reinsurance arrangements.
Advising Legal & General on the derisking of The Pearson Pension Plan by way of an approximately £600 million buy-in arrangement and on a further £500 million buy-in transaction, utilising a collateralised umbrella structure.
Advising Royal Philips NV on the transfer of £2.4 billion of the Philips UK Pension Fund’s defined benefit obligations to Pension Insurance Corporation PLC (PIC).
Advising Delta Lloyd Levensverzekering, the Dutch life insurance arm of the Delta Lloyd Group, on a transaction with Reinsurance Group of America to mitigate longevity risk related to its Dutch life insurance portfolio by way of a six year longevity swap.
The necessary attributes for advising on these transactions are extensive experience of many different structures, a desire to innovate, and an ability to structure and draft for the long term. Our team has these attributes and a track record to back it up.