UK pension risk transfer (PRT) volumes are forecast to reach between £35bn and £40bn in 2026, Standard Life has estimated.

Standard Life managing director – PRT & individual retirement, Claire Altman, noted that the UK PRT market remained highly active.

Although some schemes had paused activity to assess their endgame options, others remained on track to execute their plans by taking advantage of competitive pricing in the bulk purchase annuity (BPA) market.

“The remainder of 2026 will be defined by this divergence in approach, as schemes respond to the current mix of market opportunity and evolving regulatory clarity,” Altman said.

Altman predicted that the dynamic would shift in H2 from activity being driven by small and mid-sized deals to multi-billion pound schemes coming to market.

She added that the timing of these transactions could have a significant impact on total market volumes this year, as well as pricing dynamics.

"The return of these larger schemes has the potential to play a role in shaping insurer capacity and pricing,” Altman said.

“It remains to be seen how long favourable supply and demand dynamics will persist. For those schemes looking to seize the market opportunity in the near term, preparation and readiness will be key.”

While the focus on endgame strategy has sharpened following the Pension Schemes Act, especially the balance between run-on, insurance, and surplus usage, much of the detail was still to come, leaving trustees unsure whether to act now or wait.

In this environment, Altman argued that ongoing uncertainty and market risk meant many trustees were still likely to favour buy-in and buyout to lock in gains and provide certainty for members.

“Non-price factors are expected to continue taking centre stage for the remainder of the year, particularly member experience and transition from buy-in to buyout,” Altman stated.

“Propositions are evolving towards more personalised tools, additional guidance and digitally enabled or AI-supported member interactions.

“And there is recognition that the availability of multiple communication channels, such as telephony services alongside digital portals, is the best way to address members’ different preferences.”

Altman concluded: “Overall, the key trend shaping the UK PRT market in the second half of the year will be the choices individual schemes make, as trustees either move ahead with transactions or wait for greater regulatory clarity.

“Schemes that are already committed to their endgame strategy and well prepared to proceed are likely to be in a strong position to act. With favourable pricing and strong insurer appetite, there remains a clear window of opportunity for those ready to transact.”

---