U.S. corporate pension plan buyout sales totaled $1 billion in the first quarter, a LIMRA Secure Retirement Institute sales survey found.
The amount for the quarter was 78% lower than the same period in 2020, which saw $4.47 billion in buyout volume.
Despite the sluggish start to the year, Mark Paracer, assistant research director at the Secure Retirement Institute, said in a news release that the institute still projects pension-risk-transfer sales to be in the range of $25 billion to $30 billion in 2021. Buyout sales totaled $25 billion in 2020.
There was also a single premium buy-in contract in the first quarter for $2.8 billion, the survey found. It was the largest U.S. buy-in transaction on record.
Pension buy-in transactions, in which an insurer reimburses the company for benefit payments the plan will make to its retirees and beneficiaries, are very common in the U.K., but rare in the U.S.
"As the PRT market continues to mature, we are likely to see more innovation from the insurers seeking to provide solutions to plan sponsors interested in mitigating their pension liability," Mr. Paracer said. "We anticipate seeing more use of reinsurance, buy-ins and use of separate accounts. We also expect to see more complex deals that include both the retirees and active participants."
The survey did not identify which firm purchased the buy-in contract.
LIMRA surveyed the 18 financial services companies that provide all the group annuity contracts for U.S. corporate pension plans.