2024 bulk annuity market on track for near-record £48bn

Within that total, LCP reported a busy year for jumbo deals, leading 7 of the 14 transactions over £1bn completed in 2024.

One of the largest programmes saw the ICI Pension Fund complete a record £10bn of buy-ins across 20 transactions using a phased approach to insuring its liabilities.

LCP also advised the Rolls-Royce UK Pension Fund on a £4.3bn full buy-in, and on a £6.5bn buy-in for RSA and Intact that it described as the largest ever single bulk annuity transaction from pension schemes to an insurer, covering 40,000 members.

At the smaller end of the spectrum, LCP highlighted the £1.1bn buy-in by the SCA UK Pension Plan with Legal & General as the most prominent example of a “strategic partnership” structure during the year.

LCP said it now has a 60-strong core transaction team focused on pension risk transfer, reflecting the volume and complexity of current deal flow.

On the supply side, Royal London entered the UK buy-in and buy-out market in 2024 and wrote its first external transaction during the year.

Utmost also joined the bulk annuity market and completed its first external buy-in or buy-out transaction in 2024, according to LCP’s predictions report.

Beyond insurance, LCP said consolidation vehicles continued to gain traction, with Clara completing two further superfund transfers in 2024.

One of those was the £210m transfer of the Wates Pension Fund to Clara, which LCP said was the first superfund deal for a scheme with a non-distressed sponsor.

Following the Wates Group transfer in December, Clara’s platform reached about £1.4bn of assets under management and covered around 21,500 members.

LCP said the combination of high transaction volumes, new insurer entrants and growing use of consolidators supports its view that annual buy-in and buy-out flows will remain in the £40bn to £60bn range over the coming decade.