Pensions Insurance Corporation (PIC) has announced that it has hedged £300m of longevity risk through reinsurance with Munich Re, a global reinsurer.

The deal ensures that around 65 per cent of PIC’s total longevity exposure has been reinsured, representing around £3.5bn of its total liabilities.

PIC recently announced a buy-in agreement with Aon Minet Pension Scheme, covering around 25 per cent of the scheme’s pensioner liabilities and the Cookson Group Pension Plan also signed a pension insurance buy-in agreement with the risk management solution provider.

PIC chief financial officer Rob Sewell said: “Our strong new business performance so far this year demonstrates the very high demand for defined benefit pensions insurance solutions, even against a difficult macro-economic environment.

“It is vital that we maintain our focus on securing our existing policyholders’ pensions for the long term and this reinsurance transaction helps to further protect us against the very long-dated risks we face.”

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