Royal London is the latest insurer to enter the bulk purchase annuity (BPA) market, and will be the only mutual operating in this sector.
The company will focus on working with trustees and advisers on BPA transactions of up to £500 million to secure member benefits.
Royal London has established a new team to run this operation, led by director of BPA solutions, Paul Bowker. The team of 40 are experienced in the BPA market, having been involved in hundreds of buy-ins and buyouts from small to multi-billion-pound deals, working with a range of bulk annuity providers and consultancies.
Royal London has previously transacted a £250m full scheme buy-in policy with the trustee of the Royal Liver UK Pension Scheme in November 2023, and a further £350 million buy-in policy in January 2024 to insure a subset of members in the Royal London Group Pension Scheme.
In July the group transacted with its first external pension scheme, securing a £30m full scheme buy-in, followed by a further £100m transaction with another external pension scheme in September.
Royal London chief executive officer Barry O’Dwyer says: “With an increasing number of pension schemes looking to meet their de-risking objectives, it’s an important time to be providing a mutual choice.
“Royal London is the only mutual in the BPA market, and we believe that will be an attractive proposition for many trustees.”
Paul Bowker, director of BPA solutions at Royal London adds: “We have invested significantly to build a compelling bulk annuity offering for trustees and their members. They will be able to partner with a well-known mutual brand with proven financial strength, in the confidence we only have their members’, and all our customers’ interests, at the core of our long-term decision making.
“We will be building on our strong customer service credentials and delivering our BPA administration in-house to ensure we deliver the highest standards of service.”