BBC Pension Scheme, Zurich and MetLife complete £6bn longevity swap deal
The swap provides protection against the risk of rising costs if members live longer than expected, covering nearly all pensioner and dependant liabilities in the Scheme.
BBC Pension Scheme has completed a £6bn longevity swap with Zurich Assurance Ltd (Zurich) and Metropolitan Life Insurance Company (MetLife), covering around 21,000 pensioners.
The swap provides protection against the risk of rising costs if members live longer than expected, covering nearly all pensioner and dependant liabilities in the scheme.
Under the terms, the Trustee keeps flexibility, control and security, while Zurich’s approach aims to reduce cost and operational burden.
Aon was the sole transaction adviser, handling negotiations with Zurich and broking the reinsurance with MetLife.
Legal advice went to the Trustee from A&O Shearman, Zurich from Slaughter and May, and MetLife from Eversheds Sutherland and Debevoise & Plimpton.
Catherine Claydon, chair of the BBC Scheme trustee board, said: “The Trustee is pleased to have further mitigated the Scheme’s exposure to longevity risk, through a second transaction on highly attractive terms for the Scheme.
“Many thanks to our advisers, Zurich and MetLife for achieving this important milestone.”
Greg Wenzerul, head of longevity risk transfer at Zurich, said: “We’re privileged to have partnered with the Scheme Trustee and their advisers on this important phase of their de-risking strategy.
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