U.S. pension risk transfer premiums among the most competitive bidding processes rose further in September to above 101%, a study by actuarial and consulting firm Milliman showed.
The estimated average premium among the most competitive rates was 101.1% as of Sept. 30, up from 100.5% as of Aug. 31, according to a report about the Milliman Pension Buyout index.
Also during September, the average annuity purchase cost across all insurers increased to 103.5% from 102.9% a month earlier.
"Although interest rates climbed during September, retiree buyout costs failed to keep pace, rising to their highest levels in 2023," said Jake Pringle, a principal and consulting actuary with Milliman and co-author of the study, in an Oct. 26 news release. "Despite the slight increase in costs, many plan sponsors have PRT on their agenda, so we should expect to see continued heavy volume to close out the year."