Mens Sponsor

Pension insurance enables companies with a Defined Benefit (DB) pension scheme to transfer all of or some of the risks associated with that scheme to an FSA regulated insurance company. Pension insurance provides the best possible security to trustees, beneficiaries and sponsors of DB pension schemes. By insuring the risk associated with a DB pension scheme sponsor businesses remove the pension liability from their balance sheets and also free up managements to focus on realising the true potential in their core business.

Pension insurance requires specialist expertise in a variety of areas, including:

Actuarial: pension insurers need to assess the longevity risk associated with a Defined Benefit pension scheme.

Pensions administration: part of the pension insurer's role involves administering a pension scheme as cost effectively as possible.

Investment: pension insurers apply specialist investment expertise to maximise returns from funds under administration.

Risk management: pension insurers focus intently on the active management of all the risks in the business to better control outcomes and achieve better value for clients.

Liability Management: Pension Insurance Corporation needs to manage its risks in areas like interest rates and inflation.

Information: Pension Insurance Corporation wants to know exactly what its assets and liabilities are in real time and so be able to communicate to its management, regulators and policyholders in an accurate and very timely way.

The pension insurance industry has existed since the 1980s but the market has opened up significantly since the UK Pensions Act of 2004 and the creation of the Pensions Regulator in 2005. Both events formalised the procedures for dealing with pension funds that are currently under funded or in deficit. The Pensions Regulator is encouraging corporate schemes to investigate pension insurance.