The Pension Insurance Corporation has completed a £200m buy-in with trustees of the 3i Group Pension Plan.

The approximate £200m premium covers around 40 per cent of the plans liabilities for pensions in payment.

The investment firm’s trustees were advised by LCP and Linklaters.

Chairman of trustees Carol Woodley, said: “The Plan has been de-risking for a number of years, primarily by moving our asset mix to favour index-linked gilts. We are very pleased to have been able to complete this logical next step in our long-term de-risking programme. PIC demonstrated significant expertise while helping us to manage a complex project and ultimately deliver the transaction we required.”

PIC head of origination structuring Uzma Nazir said: “The Plan’s Trustees and the company have a well-developed de-risking strategy in place. As part of this strategy, the Trustees have been increasing the proportion of the Plan’s assets invested in bonds over time. This strategy has proved to be the right one and the Trustees have now been able to de-risk a significant proportion of the liabilities. We are delighted to have been able to help them achieve this goal.”

LCP partner and lead adviser on the transaction Michelle Wright said “The buy-in is an important step in the Plan’s de-risking journey, reducing the Plan’s exposure to longevity risk and providing perfect hedging of the Plan’s complex pension increases for around 40% of the Plan’s liabilities for pensions in payment. The transaction has enabled the Trustees to reduce risk on very competitive terms and is an excellent example of the attractive pricing that persists in the market for well-prepared pension plans”.

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