Pension Corporation, a leading provider of risk management solutions to defined benefit pension funds, today announces that the Trustee of the Nova Chemicals UK Pension Plan (“the Plan”) has entered into a pension insurance buyout agreement with Pension Insurance Corporation (“PIC”). The insurance buyout agreement covers liabilities of £30 million and the Plan’s 155 members, mainly based in Manchester.
The pension buyout agreement was the result of a risk management approach taken by the Trustee with the support of the sponsor. This saw the Trustee invest over time in low risk assets and away from equities, with the aim of minimising the Plan’s exposure to potential market dislocations.
Martin Sanderson, Plan Trustee, said:
“This buyout agreement was made possible by close co-operation between the Company, Trustee and professional advisers, working towards agreed objectives. The buyout agreement brings further increased security to members' benefits for the long-term. Pension Insurance Corporation's tailored solution and competitive financial proposition helped secure their selection ahead of several other insurers. Mercer Limited’s advice in helping obtain the right contract and advice from Squires, Sanders & Dempsey (UK) LLP and JLT Benefit Solutions Limited in completing the process was invaluable.”
Mitul Magudia, Pension Insurance Corporation, said:
“The pension buyout enhances what is already proving a successful year to date for Pension Insurance Corporation, having already written approximately £500m of new business. The pension buyout market is particularly busy in 2011, whereas in the previous three years pensioner buy-ins were more prominent in the risk transfer market. PIC is involved in auction processes for buyouts and buy-ins for small and medium pension funds totalling approximately £1.5bn; and large pension funds where we are participating in processes totalling approximately £8bn.”
Akash Rooprai, Mercer Limited, said:
“We were pleased to be able to help the Plan Trustees and the Company obtain the right deal for the Plan members, in terms of price, member security and other contractual terms.”
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