KLM and Vistry reveal buy-ins as market tipped to reach £70bn
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The 2026 risk transfer market is now predicted to reach £70bn, up about 15% from last year, as two further defined benefit schemes have just revealed their buy-ins.
The latest Derisking Report by WTW forecasts that bulk annuities alone could exceed £50bn this year, citing larger transaction sizes and pricing, while longevity swaps could reach £20bn, with the consultancy saying there is growing interest from schemes of all sizes to support run-on strategies or lock in part of future bulk annuity pricing.
“The risk transfer market is entering 2026 with strong momentum,” said Gemma Millington, senior pensions risk transfer director at WTW. “Schemes continue to benefit from improved funding levels and strong insurer appetite, which together create very favourable conditions in which to secure members’ benefits at compelling prices. We expect this window to remain open through 2026, but trustees will need to be prepared and strategic to take full advantage.”
The Pension Protection Fund’s latest update shows the aggregate funding of DB schemes has increased by £5.9bn since the previous month, reaching a PPF funding ratio of 131%.
Millington advised schemes to plan early and engage collaboratively with the market given current levels of activity.
The firm also anticipates two new superfund entrants this year, with transactions possibly doubling. WTW also thinks there will be at least one “entirely new” risk transfer solution this year but does not give further details.
“The risk transfer market is entering 2026 with strong momentum,” said Gemma Millington, senior pensions risk transfer director at WTW. “Schemes continue to benefit from improved funding levels and strong insurer appetite, which together create very favourable conditions in which to secure members’ benefits at compelling prices. We expect this window to remain open through 2026, but trustees will need to be prepared and strategic to take full advantage.”
The Pension Protection Fund’s latest update shows the aggregate funding of DB schemes has increased by £5.9bn since the previous month, reaching a PPF funding ratio of 131%.
Millington advised schemes to plan early and engage collaboratively with the market given current levels of activity.
The firm also anticipates two new superfund entrants this year, with transactions possibly doubling. WTW also thinks there will be at least one “entirely new” risk transfer solution this year but does not give further details.
Several insurers are expected to change hands in 2026 – Athora is buying Pension Insurance Corporation, Brookfield is taking over Just Group and merging it with Blumont, and JAB Insurance is set to buy Utmost’s life and pension business. These changes mean trustees should focus on financial due diligence and be aware of any short term operational or cultural disruption, Millington advised.
Meanwhile, regulatory scrutiny of funded reinsurance models “may create pricing headwinds for some insurers”, the report notes, but WTW does not expect a big impact on the market overall.
The predictions come as two further schemes have recently agreed bulk annuities. The KLM UK Pension Scheme, for the Dutch air carrier, completed a £240m buy-in with Rothesay in December last year, covering the remaining scheme members, including 924 pensioners and 928 deferreds.
Albert Schmidt, who chaired the trustee transaction committee, said: “We prepared this buy-in on a short timescale, in close cooperation with the company and the support of our scheme advisers Capita Pension Solutions and Sackers, and EY as company adviser.”
Capita has advised the KLM trustees for two decades. Colin Parnell, director of risk transfer, said: “Our intimate knowledge of the scheme, strong collaboration with all stakeholders and total commitment to every milestone enabled this last step to be completed successfully and in a very short timescale, completing the buy-in within just two weeks after entering exclusivity with Rothesay.”
EY pensions partner Eimear Kelly praised the scheme’s early preparation and Rothesay’s execution capabilities, adding: “Even in a busy market, schemes that are thoroughly prepared can confidently access the insurance market to protect their members’ pensions.”
Roisin O’Shea, business development at Rothesay, noted that the deal completed “within two months of the scheme approaching the market”.
The pension trustees of Vistry, a provider of affordable mixed tenure homes, have agreed a combined £155m buy-in with Pension Insurance Corporation, insuring the pensions of 1,671 members. The transaction is for the Bovis Homes Pension Scheme, Galliford Try Final Salary Pension Scheme, and Kendall Cross Holdings Ltd Pension and Assurance Scheme.
Trustee Sarah Leslie, a director at trustee firm ndapt, said: “This transaction is a great result for our members and is testament to the highly collaborative approach between the trustee, company, PIC and the schemes’ advisers. We selected PIC due to its track record for delivering first class customer service and their focus on members.”
Vistry’s group chief financial officer, Tim Lawlor, added: “This agreement secures the long‑term pension commitments made to our colleagues, former colleagues and their families, while significantly reducing risk and removing future pension‑related volatility from our balance sheet.”
Jake Stanbridge, origination actuary at PIC, said multi‑scheme transactions require careful coordination. “Working closely with the trustee and advisers, we delivered a tailored solution that provides long‑term security for members,” he added.
LCP advised the trustee on the transaction, while CMS gave legal advice. PIC’s lawyers were Herbert Smith Freehills Kramer.
The predictions come as two further schemes have recently agreed bulk annuities. The KLM UK Pension Scheme, for the Dutch air carrier, completed a £240m buy-in with Rothesay in December last year, covering the remaining scheme members, including 924 pensioners and 928 deferreds.
Albert Schmidt, who chaired the trustee transaction committee, said: “We prepared this buy-in on a short timescale, in close cooperation with the company and the support of our scheme advisers Capita Pension Solutions and Sackers, and EY as company adviser.”
Capita has advised the KLM trustees for two decades. Colin Parnell, director of risk transfer, said: “Our intimate knowledge of the scheme, strong collaboration with all stakeholders and total commitment to every milestone enabled this last step to be completed successfully and in a very short timescale, completing the buy-in within just two weeks after entering exclusivity with Rothesay.”
EY pensions partner Eimear Kelly praised the scheme’s early preparation and Rothesay’s execution capabilities, adding: “Even in a busy market, schemes that are thoroughly prepared can confidently access the insurance market to protect their members’ pensions.”
Roisin O’Shea, business development at Rothesay, noted that the deal completed “within two months of the scheme approaching the market”.
The pension trustees of Vistry, a provider of affordable mixed tenure homes, have agreed a combined £155m buy-in with Pension Insurance Corporation, insuring the pensions of 1,671 members. The transaction is for the Bovis Homes Pension Scheme, Galliford Try Final Salary Pension Scheme, and Kendall Cross Holdings Ltd Pension and Assurance Scheme.
Trustee Sarah Leslie, a director at trustee firm ndapt, said: “This transaction is a great result for our members and is testament to the highly collaborative approach between the trustee, company, PIC and the schemes’ advisers. We selected PIC due to its track record for delivering first class customer service and their focus on members.”
Vistry’s group chief financial officer, Tim Lawlor, added: “This agreement secures the long‑term pension commitments made to our colleagues, former colleagues and their families, while significantly reducing risk and removing future pension‑related volatility from our balance sheet.”
Jake Stanbridge, origination actuary at PIC, said multi‑scheme transactions require careful coordination. “Working closely with the trustee and advisers, we delivered a tailored solution that provides long‑term security for members,” he added.
LCP advised the trustee on the transaction, while CMS gave legal advice. PIC’s lawyers were Herbert Smith Freehills Kramer.
