JLT Employee Benefits (JLT EB) has advised the Trustees of the British Arab Commercial Bank Pension Scheme on the industry’s first whole of market underwritten buy-in transaction for a £12m tranche of liabilities in its £60m pension scheme. Following this competitive process, the buy-in was awarded to Partnership – one of the UK’s leading enhanced annuity providers – and covers all non-insured pensioners.
Traditionally, a buy-in using medical underwriting is completed with one insurer selected upfront. Working with insurers, JLT EB has developed this new process whereby a third party, MorganAsh in this instance, collects medical information on behalf of the Trustees through a short medical questionnaire. The results of the questionnaire are then provided to all insurers with identical medical information to enable them to price the buy-in, which leads to a more competitive process.
Graham Wardle, BESTrustees, Chairman of the Trustees, said:
"With a response rate representing 95% of the pension liabilities, we were able to give the insurers detailed information to accurately price this whole of market buy-in exercise. With JLT Employee Benefits advising us, we were able to achieve a competitive price by selecting Partnership Assurance and we are pleased with how streamlined the process was. The continual derisking of our pension scheme is an important goal and ensures the long-term security for our members."
David Barratt, Buyout Consultant, JLT Employee Benefits, said:
"This new process for completing underwritten buy-in transactions is an important step for Schemes looking to derisk in the most cost effective way. We are continually looking to improve efficiencies for our clients and are delighted to have brought this new process to the market, which we feel will revolutionise the medically underwritten buy-in market."
Will Hale, Director of Corporate Partnerships, Partnership Assurance, said:
"We were happy to support JLT Employee Benefits develop this new market process. A common approach to the collection of health and lifestyle information from members will ensure that Schemes wishing to de-risk through an underwritten exercise will now have a choice of insurers and can be confident of attaining a competitive price. Trustees of the British Arab Commercial Bank Pension Scheme, have made an important step in derisking their Scheme and the transaction represents a key landmark in the development of the underwritten bulk annuity market."