Lincoln Pensions: We advise on longevity swap for the Willis Pension Scheme

6 July 2020

Lincoln Pensions publishes on its website:

“We are delighted to have advised the trustee of the Willis Pension Scheme (“the Scheme”) on its recent £1bn longevity swap deal with Munich Re. The longevity reinsurance transaction, which covers roughly 3,500 defined benefit (“DB”) pensioner members and their dependants, was structured through a Guernsey-based captive insurer fully owned by the trustee of the scheme.

We assisted the trustee in evaluating the financial strength of Munich Re at a time of heightened market volatility, working alongside the trustee’s other advisors and the Munich Re management team.

Peter Routledge, Chair of the Willis Pension Scheme, noted: “I am delighted that the trustee has taken a first and significant step to ensure that our members’ benefits are secured against future improvements in life expectancy, supplementing the trustee’s wider risk management program to protect the scheme against investment and demographic volatility.”

Adolfo Aponte, Managing Director at Lincoln Pensions, noted: “It has been a pleasure to work with the trustee and its other advisors in a process to further enhance the security of members’ benefits. The economic backdrop made it imperative for our team to work seamlessly alongside the trustee’s other advisors to ensure the trustee had access to the latest information on the longevity reinsurance provider. We have seen increased interest from DB pension schemes looking to evaluate and monitor their counterparty exposures, whether that exposure arises from an insurer, reinsurer or capital provider.”

We have market-leading expertise in advising trustees and sponsors on the covenant implications of risk-transfer transactions. Our end-game risk-transfer practice has advised on over £5.5 billion of DB pension liabilities transactions so far in the year.

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