Aviva today announces it has completed a £26m bulk purchase annuity buy-in transaction with the Trustees of the Association of British Insurers Pension & Assurance Scheme. This is the second transaction between Aviva and the Association of British Insurers Pension & Assurance Scheme, following a £10m transaction completed in 2017.
Aviva will insure the defined benefit pensioner liabilities for 191 members, removing the investment and longevity risk of these members from the Scheme. Members will see no change in the amount of their benefits or the way in which they are paid as a result of the transaction.
The competitive tender process to select an insurer and negotiate terms was led by Mercer, with Shepherd and Wedderburn LLP providing legal advice.
Jamie Cole, Head of Bulk Purchase Annuity Origination at Aviva, said: “We are delighted to have completed a second transaction with the Association of British Insurers Pension & Assurance Scheme.
“All parties worked closely to ensure the smooth and efficient completion of this transaction which provides greater security for Scheme members and shows Aviva’s flexibility in transacting with schemes of all sizes.”
Philip Exact, Chairman of the Association of British Insurers Pension & Assurance Scheme’s Trustees, said: “We worked closely with the ABI and Mercer over the last 12 months to plan, and then take, this important step on our journey to further reduce the Scheme’s risks.
“Aviva were selected after a competitive tender process and we are very pleased to have successfully completed this transaction.”
Deborah McWhinney , Risk Transfer Principal at Mercer, said: “We are very pleased to have been able to work with the Trustees again and bring this second tranche of pensioners to the market.
“This is a further significant step for the Trustees in their de-risking journey and represents a positive outcome for the long term security of members’ benefits. Despite ongoing uncertainty, we continue to see pension schemes concentrating on de-risking activity and we are looking forward to seeing more transactions throughout the year”.
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