ICL Group Pension Plan, Bracknell, England, insured £3.7 billion ($5.1 billion) in liabilities through a longevity swap with its own captive insurer, said a spokesman for Willis Towers Watson, an adviser on the deal.
The deal was structured through an insurance company in Guernsey, which is owned by the plan's trustee. The name of the company was not available. It was the plan's first longevity swap and risk transfer transaction. The deal was reinsured by Swiss Re.
The swap covers liabilities linked to 9,000 retired plan participants and about half of the total longevity risk of the £5 billion plan, which is sponsored by global information technology services company Fujitsu.
"By hedging the longevity risk associated with our pensioners, we have significantly reduced the overall risk in the plan and improved security for all our members," David Sillitoe, trustee chairman of the ICL Group Pension Plan, said in a news release.
