Superfunds to take on more leading roles in risk transfer market – Hymans Robertson

Superfunds have come of age, according to Hymans Robertson, as completed deals over the past two years have helped to build understanding and confidence for future transactions.

The report argued that opinions have shifted from widespread scepticism, to superfunds being widely viewed as a valuable addition to the pensions market.

With future transactions expected to lead to interest from potential new providers, The Pensions Regulator (TPR) will hold a key role in responding to changing market dynamics, according to the consultancy.

TPR will operate within the future superfund legislation to regulate this market, but the balance between regulation and supporting innovation must be maintained, the firm warned.

Iain Pearce, head of alternative risk transfer solutions at Hymans Robertson said: “As superfund transactions become more common, we anticipate more schemes to view these as an attractive option.

“This could drive a positive feedback loop that could result in additional superfunds entering this market in the years ahead.

“As the market changes, it would be remiss of us not to expect some teething issues with how new regimes are developed and applied.

“Endgame decisions can be complex.