Industry experts have argued that insurance transactions are “entirely achievable” for small defined benefit (DB) schemes, highlighting a number of recent small scheme deals as evidence of the opportunities available for schemes that are prepared and ready.

In its latest update, K3 Advisory announced that it completed seven small scheme buy-ins in December 2023, undertaken by Aviva and Just Group.

The total of all seven transactions was £74m and overall secured the benefits for 307 pensioners and 274 deferred members.

This ranged from a £25m buy-in that secured the benefits for 88 pensioners and 67 deferred members, to a £4m buy-in that secured the benefits for 15 pensioners and 47 deferred members.

K3 Advisory managing director, Adam Davis, argued that while small schemes have historically faced some “challenges” to access the same competitive levels of pricing as their larger counterparts, this has now changed.

“These transactions clearly show that insurance transactions are entirely achievable options for small schemes - if they’re prepared and ready,” he continued.

However, Davis stressed that the supplier market is becoming “increasingly competitive”, so it is important for small schemes to “carefully” select the advisors with the relevant small scheme expertise to meet their objectives and challenges.

“Otherwise, they could find themselves in a position whereby opportunities pass them by, and the potential for better member outcomes are lost,” he added.

This was echoed by Just Group business development manager, Kishan Radia, who highlighted these recent small scheme deals as demonstration that the is "busy, vibrant, and open to schemes of all sizes".

"For small schemes in particular, being well prepared secures insurer engagement,” he stated.

Adding to this, Aviva BPA deal manager, Andrew Shaposhnikov, said: "Aviva have long supported market access for schemes of all sizes, so we’re delighted to have worked with K3 to secure member benefits for these smaller schemes.

“Transacted through our new streamlined service, Aviva Clarity, these deals demonstrate that small well-prepared schemes that can move quickly, are able to access the insurance market to secure member benefits efficiently and with confidence.”

A range of legal advisors and administrators provided support for these deals, with several of the transactions involving advising professional trustees.

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