London-based insurer Willis Towers Watson today announced that it had agreed a buy-in deal for £85m of the Aliaxis UK Defined Benefit Pension Scheme with Just Group.
The payments were completed in two tranches, split between a £35m sum in November 2016, and a £50m payment last December.
The deal covers 350 of the scheme's uninsured pensions which are in payment.
Willis Towers Watson said that structuring the payments in this way gave trustees a better deal as it delivered a higher price in a timely manner.
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"Following the success of the first buy-in transaction, the trustees were happy to continue our partnership with Just," a statement from the trustees of the scheme said.
"The second transaction has further increased the security of our members benefits at a price that was very attractive to the trustees."
Willis Towers Watson said:
This was a very interesting transaction that required a new approach to secure the best value for the trustees. Splitting the transaction into two parts allowed us to secure efficiencies for our client in both the process and pricing – and being able to medically underwrite the first transaction secured a further material cost-benefit.
The trustees existing relationship with Just meant that they were able to move quickly to secure favourable terms within a short period of time at the end of 2017.
Just Group added: "The financial benefits of medically underwriting buy-ins is well appreciated, but by splitting this transaction into two the benefits were increased.
"The concentration of risk of the largest liabilities was removed first taking advantage of medical underwriting, and the terms were available for a quick second transaction at a time which suited the trustees and resulted in optimal pricing."
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