M&G has completed a £100m buy-in with Miller Insurance Services, securing the benefits of 550 members of the Miller Retirement Benefits Scheme. The transaction was completed using M&G’s BPA Plus service, which combines bulk purchase annuities with M&G’s £132bn With-Profits Fund.
According to the report, this service allows the sponsor access to potential investment returns. Neil Perry, chief financial officer at Miller Insurance, said: “This transaction is an important milestone in delivering greater certainty and security for our pension scheme members.”
M&G’s BPA Plus service has been used in several transactions, including the first BPA Plus deal earlier this year. David Salter, a partner in LCP’s risk transfer team, said: “This transaction once again shows the ability of schemes of this size to generate bespoke, and competitive, proposals from a range of insurers.”
LCP was the lead adviser on the deal, while Hogan Lovells provided legal advice to the trustee board. The transaction was completed with the support of the trustees, M&G, and the advisers.
Earlier this week, Standard Life announced a £260m buy-in with the ReAssure Staff Pension Scheme, securing the benefits of around 2,750 members. The transaction was completed last month and includes “residual risk cover”, according to a press release from the insurer.
Andrew Ward, partner and head of risk transfer at Mercer, explained that the residual risk feature “acknowledged the individual scheme’s circumstances, giving the trustee confidence in the outcome achieved”. The scheme is sponsored by ReAssure, which Standard Life acquired in 2020.
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Chris Martin, chair of the ReAssure scheme’s trustee board, said: “This was a complex project and I am grateful for Standard Life’s support in achieving this outcome… Member experience has been at the forefront of our mind throughout this process and Standard Life have demonstrated their alignment and commitment in this respect”.
The transactions highlight the importance of collaboration and governance in securing the benefits of pension scheme members. Emma Haylock, bulk annuity transaction manager at Standard Life, added: “Reaching this stage reflects the close collaboration between the trustees, sponsor and advisers over several months.”
In these transactions, the use of bulk annuities provides greater certainty and security for pension scheme members. They generate bespoke and competitive proposals from a range of insurers.
The Standard Life transaction demonstrates the complexity of these deals, with the need for due diligence and strong governance to manage potential conflicts of interest. The outcome has strengthened long-term security for all members.
The M&G and Standard Life transactions are examples of the growing trend of bulk annuities in the market. As more schemes consider this option, it is likely that we will see further innovation and development in the industry, with pension funds playing a significant role.
They are securing benefits for members.
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