Two in five UK defined benefit (DB) schemes expect to complete a bulk annuity or longevity swap transaction within the next three years, Willis Towers Watson research finds.
Covid-19 has caused a slowdown in the number of bulk annuity transactions, with buy-ins and buyouts expected to amount to a maximum of £25bn this year, Willis Towers Watson says.
Around £25bn of buy-ins and buyouts are set to be transacted this year despite the Covid-19 challenges, according to Lane Clark & Peacock (LCP).
The fall in pricing of credit assets due to Covid-19 has made bulk annuities more affordable for schemes with significant gilt holdings, according to XPS Pensions.
The pension insurance market could be set for another record-breaking next year as schemes are already "in the queue" for deals at the start of next year, says Hymans Robertson.
Bulk annuity deals transacted by Just Group totalled £718m in the first half of this year compared to £296m in H1 2017, according to its latest results.
Buy-in and buyout pricing could increase due to future capital requirements for insurers holding equity release mortgage assets to back deals. Victoria Ticha looks at what it means for trustees