H1’24 sees 134 buy-ins completed with a total value of £15.2bn, Hymans Robertson

The first half of 2024 saw 134 buy-ins completed, with a total value of £15.2 billion, making it the highest number of transactions ever recorded in a six-month period, according to Hymans Robertson, the independent pensions and financial services consultancy.

Of the 134 transactions in H1’24, Hymans Robertson’s risk transfer team has reportedly been leading the advice of two-fifths of these transactions by value.

Including a surge of transactions since the middle of the year, the organisation also confirmed that this means that the industry has now seen 600 pension scheme buy-ins completed since the start of 2022.

In fact, the firm notes that the majority of those, roughly 500, have been whole-scheme buy-ins and most will now be looking to transition to buy-out, and then the remaining empty pension scheme will be wound up.

In comparison to H2’23, where larger deals predominantly dominated the market, H1’24 was far more different, as smaller and medium-sized transactions ended up being the main focus.

Additionally, this period also saw Rothesay’s £6 billion acquisition of the Scottish Widows buy-in portfolio in March 2024, as well as the UK’s second ever superfund transaction with Clara Pensions, securing the liabilities of the £600 million Debenhams Retirement Scheme.

It’s also worth highlighting that 250+ buy-ins are expected to transact over the whole of 2024, which would become a record number in a calendar year.

James Mullins, Partner and Head of Risk Transfer at Hymans Robertson, commented: “2024 is shaping up be another fascinating year for the risk transfer market. Insurers have demonstrated that they can handle record buy-in transaction numbers. The question now is how well the insurers will be able to cope with transitioning all the buy-in into buy-outs.

“Indeed, it’s incredible that around 500 whole-scheme buy-ins have completed since the start of 2022. Most of those will now be looking to transition to buy-out and then the remaining ’empty’ pension scheme will be wound up. That’s a lot of pension schemes looking to transition from buy-in to buy-out and then wind-up. And that trend is set to continue as many pension schemes can afford to fully insure and look to move to buy-out. This could create an administration bottleneck so trustees need to carefully test their chosen insurance company’s capacity for ongoing administration and the transition to buy-out.”

He concluded: “As our report shows, the remainder of 2024 looks to continue on a similar trajectory with plenty more large transactions expected over the coming months, and into 2025. There is a wider range of options for de-risking than ever before with a record eleven insurers now in the marketplace.”

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