• Kunal Sood, Managing Director of Defined Benefit Solutions & Reinsurance at Standard Life, reveals key trends for the DB de-risking market for the remainder of the year

The rise of mega-transactions, managing pension scheme illiquid asset holdings through deferred premiums, and full-scheme transactions are among the key trends set to dominate the de-risking market during the second half of 2023.

Kunal Sood, Managing Director of Defined Benefit Solutions and Reinsurance at Standard Life, part of Phoenix Group, discusses five key longer-term trends currently at play within the DB de-risking market, all of which are to set to have an increasingly important role when it comes to the considerations of Trustees within the context of the current market environment.

More mega-transactions

The market is already busy with large schemes up to c. £2bn in size. However, given the economic environment and persistently high inflation, very large schemes have also benefited from the rise in interest rates, and are now increasingly focused on de-risking, with some of the UK’s largest schemes now engaging with the BPA market. This development means that what we typically consider sizeable transactions – at around the £3-5bn mark – could become BPA ‘bread and butter’ over the next couple of years, with much larger transactions on the horizon.

The illiquid assets issue and deferred premiums

Illiquid assets continue to be a key consideration in planning for buyout, as the sudden surge in scheme funding levels has meant that many schemes are in a buyout surplus sooner than anticipated but without the liquid funds required to pay a bulk annuity premium.

These are currently presenting in the market, with increased numbers of schemes requesting a deferral of premium over periods of up to two years. However, other solutions are also available to help manage illiquid assets. In some cases, the insurer may be able to accept the assets in-specie, however this is often not the optimal solution for a scheme so it’s worth exploring whether selling or restructuring these assets could lead to a better outcome. Ultimately, for schemes in this position, it is worth having a strategy in place for how to manage illiquid assets if the journey to buyout has been considerably shortened.

Full scheme transactions

In previous years, a phased buy-in approach was commonplace as many schemes looked to secure their liabilities in tranches. However, since the end of last year, there has been a shift, largely driven by the improvement in funding levels, while liquidity issues led to a number of partial buy-ins being put on hold. In 2023, this has meant over 90% of deals coming to market have been full scheme transactions and we expect to see this trend continue throughout 2023.

Capacity and the importance of preparation

There is considerable appetite within the de-risking market right now, but there is finite capacity within the industry. With demand at increasingly high levels, preparation for buyout continues to be a vital factor when it comes to a scheme’s de-risking journey. For those schemes with accelerated funding levels, the choice may be between whether to look to secure a bulk annuity transaction now, or pause and invest in the administrative and preparatory work. Standard Life encourage trustees and their advisers to give the preparation the attention it deserves, as this will help secure the best opportunity in what is set to remain an extremely busy market.

The regulatory environment

Following the publication of recent DWP consultations on superfunds and the potential for an expanded remit for the Pension Protection Fund, the regulatory environment will remain key on the agenda during the second half of the year.

As with all proposals, the focus should be on creating the best outcomes for members, and bulk purchase annuity deals have proved to be a hugely successful innovation that have helped secure the pension benefits of millions of DB scheme members. Any potential changes will need to be carefully developed and targeted with this at front of mind.


Demand in the de-risking market has met expectations in the first half of 2023, with volumes of c. £20 billion already announced this year. Given this landscape, it seems inevitable that the £43.8bn record set in 2019 will be beaten this year.

Looking ahead to the rest of the year, there are no signs of activity slowing down, and we expect that next year will be a continuation of the same, with high levels of demand for insurer attention.


Media Enquiries

For further information, photos, video content or interviews, contact:

Samantha Griffith
PR Consultant
Standard Life, part of Phoenix Group
07752 465345

Jennifer Smallwood
Senior PR Manager
Standard Life, part of Phoenix Group
07858 367818

Notes to Editors

* In June and July, Standard Life announced the following full scheme buy-ins:

  • An £80m buy-in with the MGM Assurance Staff Pension Plan
  • A £1 billion buy-in with Chubb Pension Plan and Chubb Security Pension Fund
  • A £1.2 billion buy-in with Mitchells and Butlers Pension Plan

About Standard Life

  • Standard Life is a brand that has been trusted to look after peoples' life savings for nearly 200 years
  • Today it proudly serves millions of customers who come to Standard Life directly, through advisers and through their employer' pension scheme.
  • Standard Life is part of the Phoenix Group, the largest long-term savings and retirement business in the UK. We're proud to be building on nearly 200 years of Standard Life heritage together
  • Our products include a variety of Pensions, Bonds and Retirement options to suit people’s needs, helping our customers to invest and save for their future. We’re proud to offer a leading range of sustainable and responsible investment options.
  • We support our customers on their journey to and through retirement with comprehensive, easy-to-understand guidance so they can invest in the right way for their needs, and plan a future they feel confident about.
  • The value of investments can go down as well as up, and may be worth less than originally invested.

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