Milliman analysis: Competitive pension risk transfer costs increases from 100.3% to 100.9% in April
2024年5月23日 - 5:46AM
ビジネスワイヤ(英語)
Competitive bidding process saves about 2.4%
of buyout costs as of April 30
Milliman, Inc., a premier global consulting and actuarial firm,
today announced the latest results of its Milliman Pension Buyout
Index (MPBI). As the pension risk transfer (PRT) market continues
to grow, it has become increasingly important to monitor the
annuity market for plan sponsors that are considering transferring
retiree pension obligations to an insurer.
During April, the estimated cost to transfer retiree pension
risk to an insurer in a competitive bidding process increased from
100.3% of a plan’s accounting liabilities (accumulated benefit
obligation, or ABO) to 100.9% of those liabilities. That means the
estimated retiree PRT cost is now 100.9% of a plan’s ABO. During
the same time period, the average annuity purchase cost across all
insurers in our index also increased, from 102.6% to 103.3%. The
competitive bidding process is estimated to save plan sponsors
about 2.4% of PRT costs as of April 30.
“Competitive buyout costs increased slightly in April, to 100.9%
of ABO, which is about average for the past 12 months,” said Jake
Pringle, a Milliman principal and co-author of the MPBI. “With
interest rates at their highest levels so far in 2024, plan
sponsors with projects in the works could be optimistic about
competitive pricing for their pension risk transfers.
The MPBI uses the FTSE Above Median AA Curve, along with annuity
purchase composite interest rates from nine insurers, to estimate
the competitive and average costs of a PRT annuity de-risking
strategy. Individual plan annuity buyouts can vary based on plan
size, complexity, and competitive landscape.
To view the complete Milliman Pension Buyout Index, go to
https://www.milliman.com/mpbi. To receive regular updates with
Milliman’s pension buyout analysis, contact us at
pensionbuyout@milliman.com.
About Milliman
Milliman is among the world’s largest providers of actuarial,
risk management, and technology solutions. Our consulting and
advanced analytics capabilities encompass healthcare, property
& casualty insurance, life insurance and financial services,
and employee benefits. Founded in 1947, Milliman is an independent
firm with offices in major cities around the globe. Visit us at
Milliman.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20240522926300/en/
Jake Pringle Milliman, Inc. Tel: +1 713 202 0819
jake.pringle@milliman.com