Download Life Risk News Volume 3, Issue 9, September 2024

Defined benefit pension schemes seeking an insurer-led buy-out will, in many instances, have to divest themselves of any illiquid assets they hold in their investment portfolio. With buy-out activity almost touching £50bn in the UK’s bulk purchase annuity market in 2023, the divestment of illiquid assets has become a frenzied process. Samantha Downes spoke to André Kerr, Partner at XPS Group, Kunal Sood, Managing Director for Defined Benefit Solutions at Standard Life, Joe Evans, Senior Vice President at Redington and Ajith Balan Nair, Head of Asset Class and Manager Research at Isio, to get their thoughts on the topic in Illiquid Assets a Blessing and a Curse for Pension Schemes en Route to a Bulk Purchase Annuity Solution, our cover story this month. 

The US and the UK PRT markets combined deliver the vast majority of activity globally, but Canada also has a healthy bulk purchase annuity market. Aaron Woolner spoke to Mary Kate Archibald, Principal at Ecklers, to get her views on the current state of the space in Canadian Pension Risk Transfer Market Set for Record Year Even as Interest Rates Fall. 

There are many features and benefits of reverse mortgage securitisations. However, institutional investors seeking exposure to this asset have largely only been able to play in the US market, because there has been so little securitisation issuance in other countries. A new door has recently opened – or, rather, re-opened – in Australia, however. Greg Winterton spoke to Joshua Funder, CEO at Household Capital, to get his thoughts on the outlook for the space in Australian Equity Release Mortgage Securitisation Market Set for Take-Off? 

Anthropogenic global heating will have a direct impact on life expectancy according to a study published by The Lancet recently. Part of the publication’s Countdown initiative, which tracks the impact of climate change on health, the study looked at the impact of rising temperatures on mortality in European regions. Aaron Woolner spoke to Nicky Draper, Longevity Consultant at Crystallise, to get her views on the trend in Climate Change Likely To Have Multiple Impacts. 

Retirement planning in the US typically involves discussions around investments such as stocks and bonds, and, for the more affluent, offerings such as hedge funds, private equity, and real estate. But for many Americans, their life insurance policy is their second largest asset, after their home. And many of these life insurance policies meet the criteria for sale in the life settlement market. So, why aren’t more American Seniors taking advantage of this option as part of a more holistic retirement planning solution? Greg Winterton held a roundtable discussion with Rob Haynie, Managing Director at Life Insurance Settlements, Bryan Nicholson, Executive Director at LISA and Chris Orestis, President of Retirement Genius, to get their thoughts on why – and what can be done to improve the current situation – for How Can Life Settlements Become a Fixture in Retirement Planning for American Seniors? 

If DB and DC schemes are on opposite sides of the spectrum, CDC sits near the middle, perhaps leaning towards DC with the risks that members still take. What if legislation promoted the development of further DB/DC-style schemes, taking the best parts of both DB and DC to create schemes that work for all? Mark Stansfield, Actuarial Consultant at Hymans Robertson, offers his thoughts in DB, DC, and the Spectrum of Scheme Designs In Between, a guest article this month. 

September sees the return of something resembling normalisation for the working world, as a new school year resumes and the sun sets on summer. It’s also the month in which ELSA holds its annual Secondary Life Markets Conference, and so Bill Corry, Managing Partner at Corry Capital Advisors, and current ELSA Chair, gives his insight into the past and upcoming year at ELSA in Progress and Plans: The Previous and Upcoming 12 Months at ELSA, our second guest article this month. 

Summer has now turned to autumn – unofficially, at least – and there is less of the year to go than has passed. So, Greg Winterton spoke to Rainer Gruenig, CEO at Plenum Investments, to get his thoughts on how the life settlement industry has fared generally so far this year as the home stretch of 2024 begins in this month’s Q&A. 

Traditional wealth management practices for retirees have not always deeply integrated longevity risk – the risk of outliving one’s assets – into their investment strategies for their clients. But for many wealth managers, the reality of their clients living longer is forcing them into something of a rethink; a rethink that ties directly into the expertise of the life settlement industry. Greg Winterton spoke to Jay Jackson, CEO at Abacus Life, for his thoughts on the trend in Longevity Risk Increasingly Influencing Retirement Planning Approaches.