ICAEW’s £200m scheme completes medically underwritten buy-in
Institute's pension fund underwritten after info received through telephone interviews
THE Institute of Chartered Accountants Staff Pensions Fund has secured a medically underwritten buy-in to cover its highest value pensioner members.
The transaction, which made use of medical information gathered through telephone interviews to price the risk, covers £24m of the £200m scheme’s liabilities, reports sister publication Professional Pensions.
The insurer has not been named, but PP understands it is the same company that completed the £8.25m medically underwritten buy-in with the Greenhous Group announced last week (Professional Pensions Online 6 February).
Hymans Robertson, which advised the scheme, said the scheme had been exposed to a significant concentration of risk with a small number of pensioners representing a very large proportion of their liability.
Trustee chairman and former ICAEW president David Illingworth said the deal had provided a “tailored and cost-effective solution”.
He said the said the transaction had removed the risk “at a cost close to our technical provisions reserves: a great outcome for everyone associated with the fund”.
Hymans Robertson said the scheme had benefited from the “significant early mover advantage” to get a good price.
Consultants have noted that insurers are pricing particularly competitively at the moment in a bid to try to establish the market.
Hymans Robertson head of buyout James Mullins said: “We are seeing rapidly growing interest from pension schemes of all sizes in this interesting area, and as a result, I expect medically underwritten buy-ins to reach £500m by the end 2014.”