Summer can occasionally give professional trustees the illusion of breathing space. The meeting cycle softens, diaries look marginally less hostile, and there may even be a moment to remember what a lunch break is. The risk transfer market, however, has shown little interest in such seasonal conventions. Insurers remain busy assessing opportunities, sponsors continue to refine endgame plans, and trustees are increasingly finding that “nearly there” can still involve a surprisingly long to-do list.
That is not necessarily a bad thing. A buoyant risk transfer market is good news for many schemes, particularly those that only a few years ago may have viewed insurance as a distant aspiration rather than a practical near-term option. But a busy market also brings practical challenges. Capacity, data, administration, legal work, decision-making and stakeholder expectations all need careful management. In other words, the transaction may be the headline, but the operational plumbing still needs to work. As anyone in pensions knows, the plumbing is usually where the excitement hides.
From a trustee perspective, five themes stand out in the current market.
1. Bottlenecks Are Forcing Projects To Take Longer
The journey from buy-in to buyout is taking longer than many would like to admit
- For many schemes, the old planning assumption was that moving from buy-in to buyout and wind-up might take around two years. Beat that timetable and the project team could feel quietly pleased with itself. Miss it by much, and there was usually a specific issue to point to.
- That assumption now looks increasingly optimistic. For a growing number of schemes, three years may be a more realistic expectation. This is not because everyone has suddenly forgotten how to run transactions. Rather, the market is busy, specialist resources are stretched, and the volume of schemes trying to complete the same post-transaction work has increased materially.
- Data cleanse and administration remain frequent pressure points. Trustees can add real value by helping the parties prioritise, keeping momentum visible, and recognising that the issue is often not willingness but bandwidth. In pensions, the phrase “just a data point” has a habit of becoming a small project in disguise.
2. Project Management is Key to Drive Progress
A buy-in is a major milestone, not the ceremonial cutting of the ribbon
- A buy-in is rightly seen as a watershed moment. It is a significant achievement and often the culmination of years of funding, investment and preparation. But it is not the end of the story. The scheme still needs to move through the detailed work required to reach buyout and wind-up.
- Much of this work is not visible to members and sometimes even sponsors. It rarely features in celebratory announcements and is unlikely to be discussed at length outside the project team. Yet it is essential. Member records need to be finalised, benefits reconciled, legal documentation completed, residual risks considered and decisions tracked properly.
- Trustees should therefore resist any temptation to let governance intensity fall away after signing. Clear timelines, named owners, realistic budgets and regular progress reporting matter just as much after the transaction as before it. The victory lap can wait until the last loose end has stopped producing emails.
3. Buoyant and Expectant Market
The market is busy, and expectations are rising with it
- The DB risk transfer market continues to generate impressive volumes and confident commentary. Each year seems to arrive with another round of predictions, deal announcements and perfectly reasonable-sounding explanations for why the market is busier than ever.
- Crucially, this is not only a large-scheme story. Smaller schemes, including those below around £20m, appear to be seeing better engagement than in previous years, with more competitive pricing and a broader range of insurer appetite and solutions.
- That is welcome, but it also changes expectations. Sponsors may reasonably ask why their scheme cannot move quickly if others appear to be doing so. Members may assume that a transaction announcement means everything is effectively complete. Trustees have an important role in translating market optimism into practical, scheme-specific reality — ideally before optimism becomes impatience.
4. Increased Options
More endgame options are welcome, provided they do not create decision paralysis
- The pensions industry is not always accused of reckless haste, but the endgame market has developed quickly. Trustees and sponsors now have access to a wider set of options, structures and strategic routes than would have been available in the past.
- Buyout remains the preferred destination for many schemes and, in the right circumstances, may still represent the cleanest solution. But it is no longer the only credible answer in every discussion. That is positive, although it does mean trustees and sponsors need to be clearer about their objectives, constraints and risk appetite.
- Workshop-style conversations can be particularly useful, especially where different stakeholders have different priorities. More choice is a good thing, but only if it leads to better decisions rather than longer slide decks.
5. Surplus Planning
Surplus planning should start before everyone is staring awkwardly at the surplus
- Higher gilt yields, competitive insurer pricing and improved funding levels mean more schemes are approaching endgame discussions in relatively strong financial health. In some cases, there may be residual assets once liabilities have been secured.
- Surplus is one of those topics that can sound pleasantly positive until the detail arrives. Scheme rules, fiduciary duties, legal advice, tax considerations and sponsor expectations all matter. The expected changes from April 2027 may increase flexibility, but they will not remove the need for careful trustee judgment.
- The best time to develop a surplus framework is before a decision is urgent. Early conversations between trustees, sponsors and advisers can help identify principles, manage expectations and avoid unnecessary delay. Few projects are improved by discovering late in the process that everyone has been using the same word to mean slightly different things.
Payam Kazemian, Client Director, Head of Risk Transfer – Zedra
