2025 set to be another record-breaking year for the risk transfer market

• Insurer volumes reach £45bn with recording breaking transactions set to continue in 2025.

• Large transactions dominate bulk annuity volumes with ten transactions worth more than £1bn.

• Unprecedented growth for both small and large schemes – the market is truly reflecting scheme of all sizes.

• The alternative risk transfer market continues to gather pace with another two superfund deals taking place in 2024.

• New insurers set to grow market with Brookfield Annuity set to enter in 2025, with the majority of insurers regularly quoting on transactions under £100m.

2025 will be a buoyant year for the risk transfer market, says Hymans Robertson, as it issues its annual risk transfer report today. The leading pensions and financial services consultancy’s report expects 2025 to have a record-breaking number of transactions, across both small and larger schemes.

The superfund market looks likely to grow and innovate increasing the availability of endgame options. With such a growing market, these changes provide an array of opportunities for pension schemes of all sizes. 

Commenting on the findings from the 2025 risk transfer report, Lara Desay, Partner and Head of Risk Transfer, Hymans Robertson says:

“2025 looks set to be a period of huge growth for the risk transfer market with the whole market – both large and small schemes – in a boom period. As in previous years, large schemes have dominated the market with at least six insurers completing transactions greater than £1bn. However, an unprecedented number of small schemes have also completed whole scheme buy-ins with increased automation leading to slicker and more succinct processes and systems.

“For larger schemes with great size has come great opportunity. Improved pension scheme funding, alongside increased scale and ambition from bulk annuity insurers, has combined to stimulate interest in insurers from the largest pension schemes. However, alongside the opportunity, there has also been challenges. Larger schemes are more than likely to have Illiquid asset challenges requiring time and patience from both sides to work through. Allowing ample time and attention to consider operational and administrative aspects of a transaction is also key. 

“Two years ago, we saw the first superfund transaction take place, and this has been followed by another two deals in 2024, including the Debenham’s transaction led by Hymans Robertson. This was a huge year for the alternative risk transfer market and as knowledge of Clara grows, the momentum is likely to build. We expect to see a steady stream of transactions in 2025 with Clara continuing to build its capacity in tandem.

“The key theme for this year has been the increased capability from insurers and alternative risk transfer providers. Headlines of broken records for the industry confirm that risk transfer remains an attractive derisking tool and this demand is only set to continue. We believe that buy-in volumes will remain, or exceed, the £40bn mark for at least the next five years.

“To meet such demand the Hymans risk transfer team has grown by a fifth, with four senior members of the team having previously held lead roles on the insurer side. Our team has been involved in some of the largest buy-in deals of the year, with a ground-breaking and central role in two of the largest transactions of the year. We look forward to seeing what 2025 will bring at such a pertinent time for the risk transfer market.”

The 2025 Risk Transfer report also includes Hymans Robertson's expert opinion on ESG and net zero, an update on longevity risk, a deep dive into investment trends and a review of regulatory changes in the insurance market including the implications of the Solvency UK reforms.

Our Risk Transfer Report 2025 can be read here.