The first half of 2023 saw buy-in and buy-out volumes reaching record levels, ranking as the second-highest ever for a six-month period, with £21.3bn secured, compared to £26.0bn in the latter half of 2019, according to Hymans Robertson.
Hymans conducted a study that included all eight of the market’s active insurers. Prior to 2019, the first half of the year had not seen such high contract values, with contracts totalling £17.6bn being secured during that period.
Around 94 transactions totalling £21.3bn, with an average transaction value of £227m, took place for buy-ins and buy-outs.
Hymans Robertson partner & head of risk transfer James Mullins: “The risk transfer market was incredibly busy in the first half of 2023. However, that was just the tip of the iceberg, with unprecedented demand from pension schemes meaning that the buy-in market is expected to smash all previous records over the next year and beyond.
“This means that pension schemes will need to embrace changes to the way they approach the insurance market and adopt a more targeted approach with scheme size being a driving factor.
“For many small schemes below £100m, the focus will be on having an all-encompassing view of the market to confidently approach their chosen insurer on an exclusive basis. Medium-sized schemes, between £100m and £1bn, should make sure that their broking process, and requests of the insurers, are sufficiently straightforward to ensure they are a priority case.
“Large-sized schemes, over £1bn will typically have unique considerations that need to be addressed, so the focus will be on optimal timing for all stakeholders, defining clear objectives and requirements at the outset with detailed insurer engagement.”
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