The UK market is expected to top £40bn this year, with £20bn already signed and another £20bn in the pipeline.
The pension risk transfer market as a whole is experiencing a record-setting year, with insurers expected to secure over £250 bn in UK and US volumes over the next three years.
In 2024, both markets are likely to grow significantly, with Legal & General driving major deals in the UK such as a £900mn buy-in with the ICI Pension Fund and a £1.1bn buy-in with SCA UK Pension Plan.
In the US, the market completed the first quarter at a record $14.6bn, contributing to a total of $26bn for the year, a 15 per cent rise over last year.
Legal & General reported its second-highest H1 performance in the US, with $548 mn in business, and intends to write £50-65bn in UK business over the next five years.
Legal & General, institutional retirement CEO Andrew Kail says: “We are continuing to see exceptionally strong demand in both the UK and US PRT markets, with more than £250bn of combined UK and US volumes expected over the next three years. This forecast supports our strategic ambitions to grow our PRT footprint, generating permanent capital to catalyse growth in our Asset Management division.
“At L&G, strong synergies across our divisions enable us to build long-term relationships with clients and support them from investment strategy to transaction execution, as well as providing first rate customer care and administration expertise. We are confident that we will continue to deliver exceptional value to our members, clients, and shareholders.”
Legal & General retirement America president George Palms says: “The US PRT market experienced its strongest H1 on record this year, driven by pension funding ratios that soared to 109.5 per cent in July. The average transaction premium rose by 20 per cent when compared to H1 2023, reflecting the growing demand for buyouts and buy-ins from large US pension plans. With the year expected to rank among the largest ever for this market, we’re well-placed to serve plan sponsors seeking to insure their members’ benefits.”
