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Pension Funds

Pearson Pension Plan executes buy-in to insure £500 million in liabilities

Pearson Pension Plan, London, insured 500 million ($644 million) in liabilities through a buy-in with Legal & General Assurance Society, a spokesman said.

The transaction follows two buy-in deals with L&G and Aviva in 2017, when the U.K. publishing house insured 1.2 billion in liabilities.

Some 60% of liabilities of the 3.9 billion plan are now insured. "As more members retire, there will be an opportunity to insure more liabilities further in the future," the spokesman said.

Lane Clark & Peacock was lead adviser to the trustee. Linklaters provided legal advice.

The 2017 agreement with L&G allowed for additional transactions to be executed using the same terms so the trustee could move quickly to take advantage of attractive pricing, Pearson said in the news release.

"The ease of execution under the umbrella contract meant a win-win for the trustee, who was able to lock in attractive pricing relative to the very latest longevity trends, and L&G, who got off to a strong start to 2019," Clive Wellsteed, partner at LCP, said in a separate release. "The trustee was able to complete the transaction about two weeks after receiving pricing."