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Contact: David Ellis
Tel: +44 113 394 7591

Bulk annuity and risk transfer solutions

Both corporates and trustees are increasingly looking to stabilise the funding position and get certainty over contribution needs. To achieve these aims requires strategic investment planning and, where appropriate, the use of insurance products.

Controlling risk and crystallising the funding position

• Reduce risk - to identify where risk is rewarded and where it is not and decide whether to remove it
• Debt - to stabilise or improve the buy-out and Section 75 debt positions for forthcoming Corporate sales and re-structuring
• Improve funding - to gradually build on a moderate funding position in a way that reduces the risk of unexpected corporate contributions being paid, even if buyout or buy-in remain out of reach for many years
• Distribute surplus - to crystallise trapped surplus (which generally involves reducing risk to nil) in order to distribute via member augmentations and/or repay surplus to the corporate
• Transact - to work with a partner that regularly advises on, project manages and drives through complex transactions

How Mercer can help

Mercer has built specialist risk advisory and bulk annuity broking teams. By doing so we have concentrated our expertise and enhanced our ability not just to advise on, but also to transact, all manner of bulk annuity broking and investment de-risking solutions.

Mercer’s specialist teams have strong links with the wider MMC group, enabling our clients to draw from further expertise in Oliver Wyman, Marsh, Guy Carpenter and Kroll - each company being a global leader in its field.

Mercer has advised on more high-value, high-profile transactions in the UK than other advisers. Our capabilities are set out in the bullets below and articulated in greater detail in our capabilities document.

• Investment strategy advice, taking account of risk (sponsor, assets and mortality) and liability transfer aims
• The most advanced mortality measurement using postcode and past experience to spot trends
• Strategic advice on liability management exercises, including transfer value exercises
• Mortality swap broking and mortality hedges
• Bulk annuity broking
• Review of insurer financial strength
• Review of insurers administration strength

Related services

A consequence of de-risking may be wind-up. At Mercer we integrate our broking (both defined benefit and defined contribution) with our service offering to schemes following employer insolvency, when the scheme is in “assessment” with the Pension Protection Fund (PPF). We have found that investment strategy, bulk annuity strategy and the level of benefits payable to members in these situations are all interconnected and success in one area impacts favourably on others.

See our outsourcing offering in these areas: Pension Scheme wind-up services.

Contacts

Issued in the United Kingdom by Mercer Limited which is authorised and regulated by the Financial Services Authority. Registered in England No. 984275. Registered Office: 1 Tower Place West, Tower Place, London, EC3R 5BU.

E-mail this page

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Contact: David Ellis
David Ellis
Tel: +44 113 394 7591