Challenge

Prior to 2004, weak regulation and less stringent accounting standards enabled companies to underestimate the true cost and risk of their defined benefit (DB) pension schemes.

We now live in a world where pension schemes are under considerable pressure - the result of increasing longevity, unprecedented market conditions and a tough regulatory and accounting environment.

As a result, more and more DB schemes are closing to new members and future accrual, with companies increasingly looking to the end-game. And because security of benefits is essential to schemes and their members, this is expected to result in an increasing move to insurance buyout.

Nevertheless, despite a market of over £1 trillion of liabilities, to date the buyout market has seen relatively low levels of activity, with less than £30 billion of DB liabilities insured since 2006. The major stumbling block has been affordability.

Long Acre Life was created to change this.

Despite a market of over £1 trillion of liabilities, the buyout market has seen less than £30 billion of DB liabilities insured since 2006.