The trustees of three defined benefit pension schemes previously sponsored by Thomas Cook Group, totalling £50m, completed a full buy-in last November. A buyout is expected to take place this year. The transaction comes after the travel firm’s collapse in 2019.  

The schemes were bought in with Pension Insurance Corporation to cover 520 members, securing benefits at or above Pension Protection Fund compensation levels.  

“The insurance market is extremely busy at the current time, and it can be very challenging to secure member benefits for smaller schemes. It has been a long process, but PIC has offered us the opportunity to ensure that the schemes’ members receive benefits greater than what they would have received from the PPF,” said Jonathan Hazlett, managing director of Open Trustees, who acted as sole trustee to the schemes.   

Tristan Walker-Buckton, co-head of origination at PIC, said: “Many much larger schemes are now seeking to derisk this year, so demonstrating that PIC is interested in the whole buyout market and has the adaptability and scale to accommodate all sizes of deal is important to us.”  

The Thomas Cook Travel Schemes entered PPF assessment in September 2019, when travel operator Thomas Cook Group was liquidated. Other firms then bought up parts of the company, with the Thomas Cook brand still in use.   

The exact outcome for each member will not be known until the buyouts occur, according to the insurer and the schemes, who said further work is required for each scheme before they can be fully transferred to PIC.  

The process is expected to complete towards the end of 2024, once the schemes have received all funds due to them from the sponsor’s liquidation; scheme members will then be moved out of the PPF and become direct PIC policyholders. They will still be protected by the PPF during the buy-in period.    

Last May, the Thomas Cook Pension Plan completed a buy-in with Aviva for an initial premium payment of £900m, covering the benefits of more than 12,500 members.