Pensions - Articles - Insurer supply outpaces demand as small scheme buyins boom

 Small schemes accounted for around 80% of all buy-in and buyout transactions in 2024. A combination of growing insurer appetite, innovations in efficiency, and new providers joining the market, namely Utmost and Royal London, and more recently Blumont, have significantly boosted capacity, particularly for schemes in the sub-£100m bracket. This is leading to greater insurer competition across all transaction sizes. However, the leading pensions and financial services consultancy warns that on the post-transaction side insurer capacity continues to be varied. This is a key challenge for smaller schemes, as there is now a growing backlog of schemes looking to convert their buy-in to a buy-out.

 Commenting on the growing small scheme competition within the risk transfer market, Iain Church, Head of Core Transactions, Hymans Robertson says: “The changing makeup of the UK risk transfer market makes this an exciting time for small schemes. The transformation of the market is unprecedented; it has moved from a supply-constrained market to one where competition among insurers is intensifying with insurers increasingly able to meet the specific needs of small schemes.

 “With more providers now active in the space, insurers will need to work harder to differentiate themselves, not just on price, but critically on the service they provide, flexibility, and execution. A key area of opportunity lies in how quickly and effectively insurers can support schemes in transitioning from buy-in to buy-out. Every delay drives up costs, and those insurers that can combine competitive pricing with timescale certainty are likely to stand out in a market that is more dynamic and competitive than ever.”