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2019 U.S. Pension Risk Transfer Market At-a-Glance

Aon's review of the 2018 U.S. pension risk transfer market review and a look into the year ahead for the annuity settlement market.

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Pension Risk Transfer (PRT) Market - Strong in 2018

  • PRT annuity premiums increased to a record $27.5 B, up 22%.
  • Executed deals by transaction count increased 24%.

2018 PRT Market Trends

Competitive Pricing Continued

  • Nearly two-thirds of deals closed at or below benchmark FTSE PBO, while the insurer-pricing range averaged 2% above FTSE PBO.
  • Large deals ($100 M+) received even more competitive pricing – with some closing at PBO or lower.
  • Insurers maintained sufficient financial and resource capacity supporting favorable PRT market.

Repeat Transactions Reigned

  • Plan sponsors decided to “do it again” through repeat transactions.
  • Some companies transacted their fourth consecutive deal.
  • Favorable experience and execution ease were two factors driving this trend.

Aon’s Pension Risk Transfer Future Trends to Watch in 2019

  1. PRT pricing to remain attractive
  2. Plan terminations to stay active
  3. Cybersecurity protection to be essential
  4. Governance and risk mitigation strategies to continue unimpeded
  5. U.S. annuity buy-in to receive greater consideration

Why Some Sponsors Have Not Transacted (in a very active market)

  • Lower future pension income resulting from annuity settlement
  • Low current pension plan funded status
  • No time or resources to transact
  • High desire to wait and terminate the entire plan
  • Low or no appetite to trigger settlement accounting


For more information on the 2019 US Pension Risk Transfer Market, download the full whitepaper here. 

PRT Insurer Marketplace Remains Vibrant; Active Participants:

AIG, Athene, CUNA Mutual, Great American, Legal & General, Mass Mutual, MetLife, Mutual of America, Mutual of Omaha, New York Life, One America, Pacific Life, Principal, Prudential, Securian and Western & Southern.

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