Following the significant improvements in funding for defined benefit pension schemes over the last two years, many sponsoring employers and trustee boards have reconsidered their scheme's endgame. However, given the number of regulatory and market developments seen recently, for those schemes that have yet to commit to a particular approach, this year represents an important time for reviewing their endgame strategy.
For example, the Government's Response to the Options for DB Schemes notes the Government's intention to give schemes more flexibility in the future on how surpluses can be used for the benefit of sponsors and members. The bulk annuity market has seen change too, with four new insurers entering it over the last 18 months. In addition, The Pensions Regulator expects to issue further guidance around endgames in summer 2025.
Given these developments, Aon has established a UK Endgame Strategy Team focused on ensuring that every pension scheme can receive up-to-date endgame advice that is fully aligned with the scheme's objectives. The team has established its new Discover, Develop, Deliver Endgame Framework to considering endgames helping trustee and scheme sponsors to:
- Discover the scheme circumstances and their respective objectives through a framework of thought-provoking questions
- Develop an endgame strategy best aligned with these objectives and circumstances, with the support of modelling to help better inform decision making, as to whether to buyout, run-on (and if so how), or consider alternatives such as pension captives or superfunds.
- Deliver on the agreed strategy through successful implementation, using our specialist risk settlement and run-on implementation teams.
More details regarding how Aon can support schemes with this important topic in this guide are available immediately by completing the form below.
