UK's Church Workers Pension Fund completes £145m buy-in with Aviva

Written by Sophie Smith

11/10/2024

The Church of England Pensions Board has completed a £145m buy-in with Aviva, meaning that all pensions within the Church Workers Pension Fund (CWPF) Defined Benefit (DB) Scheme are now backed by insurance policies.

The deal, which completed in October 2024, builds on the fund’s previous buy-ins with Prudential in 2013 and Aviva in 2022, and is expected to "materially" reduce the risk of a future funding deficit.

The board acted in its capacity as the trustee of the fund for the buy-in, with advice from LCP and legal advice from Linklaters. Mercer provided investment advice and Cardano provided covenant advice.

As part of the deal, the pensions board paid a £145m premium to Aviva, in return for an income stream that will exactly match pensions that need to be paid to current retired members and future retiring members.

The transaction was highlighted as a “great result” for scheme members and church employers by Church of England Pensions Board chair, Clive Mather, who argued that "reaching this point is a key milestone for this scheme, opening up possibilities for the future".

“It is a prudent step which has been made possible by a long run of strong investment returns, cost savings, and collaborative working with employers,” he continued.

Adding to this, Aviva senior deal manager, Toby Holmes, said: “We’re pleased that the trustee of the CWPF has again selected Aviva to secure the benefits for the remaining members of the scheme.

“This has been a very smooth process run by a well prepared and well-advised scheme.  The trustees put environmental, social and governance (ESG) and responsible investing at the heart of their decision making and we’re proud to have been able to demonstrate our commitment in this area.”

LCP partner, David Salter, also noted the focus on ESG, adding: “Despite how busy the bulk annuity market is at the moment, it is great to see the board engaged on selecting an insurer on more than just pricing, and putting sustainability at the centre of their decision-making process.”

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