BT Pension Scheme, London, completed a £5 billion ($6.5 billion) longevity swap, with Reinsurance Group of America reinsuring the deal.
The pension fund used its wholly owned insurance company, set up when for its 2014 longevity swap, to transfer the risk, which was then reinsured by Reinsurance Group of America. For the 2014 arrangement, BTPS insured £16 billion in liabilities, reinsuring with Prudential Insurance Co. of America.
The plan has about £47 billion in assets.
The deal will have no impact on BT's cash contributions to the plan, nor its 2023 triennial valuation, BTPS said in a news release. The pension fund's primary money manager, Brightwell, along with Willis Towers Watson and Allen & Overy led the transaction, while RGA was advised by Eversheds Sutherland.
"With this transaction, we've taken a fresh approach using technology to drive down the time between quotation and execution," Wyn Francis, CIO at Brightwell, said in the release. "Protecting the scheme from unexpected rises in life expectancy is a core component to reaching a cash flow matched position by 2034."
