Pension Insurance Corporation has announced that it has agreed to insure retired pensioners and liabilities valued at £57million in its first buy-in agreement with the trustees of the Warwick International Group Pension Scheme.

The agreement means that the insurance policy will be held as an asset by the Warwick International Group Pension Scheme and will bring greater security to member benefits by offsetting liabilities. PIC will also take over responsibility for the administration of these schemes.

The buy-in has been labelled by parent company Pension Corporation a key step towards fully de-risking the pension scheme.

Phil Kelsall, as chair of the trustees for Warwick International, said: "For us, this is a crucial step in de-risking the pension scheme and increases the level of security for our scheme members. We were able to secure the insurance contract at a price within our funding provisions, so this seemed to be particularly good value."

Finance director for Warwick International Group, Steve Williams, added that the move is the best outcome for members of the pension scheme at this point in time. "It adds a new level of security to members' benefits by reducing the scheme's exposure to risk."

Pension Corporation's group chief executive, Edmund Truell, explained that the agreement also represents the group's ability to remain in the market as a big player:

"Pension Corporation is clearly in the market to write new business and has the capital to do so. We maintained a conservative investment stance throughout 2007 and 2008 which, together with disciplined pricing, place us in a strong position to work with trustees today to help them achieve their aims. We look forward to further transactions in the near future."

- Pensions Age June 2009

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