BT Pension Scheme completes two longevity swaps totalling £10bn

Written by Jack Gray

21/03/2025

The BT Pension Scheme has completed two longevity reinsurance transactions, one with Swiss Re and the other with Reinsurance Group of America (RGA), totalling £10bn.

The longevity swap deal with Swiss Re covers £5bn of pensioner liabilities, while the transaction with RGA increases the scheme’s existing cover with the reinsurer by £5bn.

A previous longevity swap transaction, which also covered £5bn of pensioner liabilities, was agreed with RGA in August 2023.

The BT Pension Scheme said the latest transactions further protected it from the cost of unexpected increases in the life expectancy of its members.

Its reinsurance leverages the scheme’s existing infrastructure, which has been facilitated through the scheme’s existing ‘captive’ insurer.

The transactions were led by Brightwell, BT Pension Scheme’s primary services provider, and supported by WTW and A&O Shearman, while Swiss Re was advised by Willkie Farr & Gallagher.

The BT Pension Scheme said the transaction will have no impact on BT’s cash contributions to the scheme.

Commenting on the announcement, BT Pension Scheme chair of trustees, Jill Mackenzie, said: “These transactions help to advance the development of the scheme’s long-term investment strategy, providing increased certainty for the scheme, our sponsor, and members.”

Brightwell chief investment officer, Wyn Francis, stated: “Brightwell’s leading role in delivering two concurrent longevity swaps demonstrates the value in a fully integrated fiduciary manager.

“These transactions will be onboarded to Brightwell’s automated, efficient and low-cost operating platform, reinforcing our experience and capability in managing all scheme risks to achieve market leading outcomes for a scheme in run-on.”

RGA UK managing director, Emma Ferris, said the firm was “delighted” to have once again partnered with the BT Pension Scheme, further supporting the scheme’s aims.

Swiss Re L&H structures solutions head, Kerry McMullan, added: “We are very grateful for the opportunity to bring our financial strength and longevity risk structuring experience to BT Pension Scheme to make the scheme more resilient to uncertain future life expectancies and helping it provide secure retirement benefits to its membership.”

The BT Pension Scheme is one of the largest private sector schemes in the UK, with around 260,000 members and approximately £36bn of assets under management.

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