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Pension Plans

Aon to move $145 million to global pension plans this year

Aon PLC, London, expects to contribute a total of $145 million to its global pension plans in 2019, the company said in a 10-K filing with the Securities and Exchange Commission on Tuesday.

By region, the insurer expects to contribute $80 million to its U.K. plans, $46 million to its U.S. plans and $19 million to other international plans. In 2018, Aon contributed $135 million, $97 million and $20 million, to its respective U.S., U.K. and other international pension plans.

In 2018, the U.K. plan discount rate was 2.95%, up from 2.63% the previous year. The U.S. plans' discount rate range was 3.92% to 4.26%, up from 3.27% to 3.61% in 2017. For other international plans, the discount rate range was 1.89% to 3.88%, up from 1.78% to 3.39% the previous year.

As of Dec. 31, U.K. pension plan assets totaled $5.225 billion, while projected benefit obligations totaled $4.129 billion, for a funding ratio of 126.5%, up from 120.7% a year earlier. The U.K. pension plan's actual allocation was: 78% fixed income, 13.3% alternative investments, 4% global equities, 2.9% real estate and 1.8% cash and cash equivalents.

U.S. pension plan assets as of Dec. 31 totaled $1.796 billion, while PBO totaled $2.877 billion, for a funding ratio of 62.4%, up from 62.1% a year earlier. The actual allocation was 36.5% fixed income, 19.1% domestic equities, 17.5% international equities, 15.4% alternative investments, 7.2% cash and cash equivalents and 4.3% real estate/real estate investment trusts.

Other international pension plan assets as of Dec. 31 totaled $1.155 billion, while PBO totaled $1.271 billion, for a funding ratio of 90.9%, up from 89.7% a year earlier.

The actual allocation of other international pension plan assets as of that date was: 68.5% fixed income, 24.3% global equities, 5.4% alternative investments and 0.9% each, cash and cash equivalents and REITs.