More schemes may be able to explore securing benefits through a superfund as a result of updated The Pensions Regulator (TPR) guidance on superfunds, adding much-needed capacity to a market for risk transfer that is highly active, according to Broadstone.
This update comes as a welcome relief for pension schemes in the risk transfer market, offering them an alternative avenue to alleviate their financial burdens, as highlighted by prominent independent consultancy firm Broadstone.
Funding levels have improved in the past 18 months, leading pension schemes to consider approaching insurers for benefits sooner than expected. But there’s a limit to the number of deals possible.
For some schemes struggling to gain traction in the insurance market, this offers a secondary option to transfer risk away from their sponsor.
Broadstone head of trustee services Chris Rice says: “Superfunds have long been the talk of the market and it appears that the Government and Regulator’s direction of travel is positive in this regard.
“For smaller schemes, the timing could well be perfect as insurers look to use their available resources in winning the larger, more commercially attractive schemes first in a buyer’s market.”
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