Nearly half (48 per cent) of defined benefit (DB) trustees said a buy-in was their preferred endgame strategy, with 40 per cent planning to approach an insurer within the next 12 months, according to research by Standard Life.

The survey of 100 DB trustees managing schemes with assets of £100m or more, also found that despite 40 per cent of schemes planning to approach an insurer within the next 12 months, there was evidence of “strong” demand for buy-in deals over longer timeframes.

Indeed, 30 per cent said they are targeting a one-to-three-year timeframe to approach an insurer about a transaction and 21 per cent plan to do so within three to five years.

There was also interest in other de-risking endgame strategies, with 25 per cent of DB trustees considering a self-sufficiency or natural run-on approach, and 12 per cent exploring a combination of de-risking options that would conclude with a buy-in.

Standard Life noted that demand for insurance-based solutions is consistent across scheme sizes.

Among schemes with assets between £100m and £1bn, 47 per cent identified buy-in as their preferred endgame, compared with 49 per cent of those managing more than £1bn, suggesting scheme size does not influence appetite for insurance-based solutions.

Standard Life also suggested that strong funding levels have been a theme of recent years, with research showing that 45 per cent of trustees said their schemes are fully funded or in surplus.

The firm noted that the improvement in funding levels has led to discussion about the range of different endgame strategies open to trustees, yet the findings revealed that superfunds remain a niche option, with only 3 per cent of trustees actively exploring them.

In terms of the reasoning behind not taking alternative options despite their availability, Standard Life found that the certainty and security offered by insurers is a key driver.

Indeed, 34 per cent of trustees said that the “certainty and security to scheme members that they will receive their pension income” was the most important reason that buy-in was being considered. 

Standard Life business development & origination director, Claire Altman, said that although the evolving regulatory landscape and the Pension Schemes Bill have prompted “important conversations” around de-risking and the use of scheme surpluses, “buy-in remains a key strategy for trustees aiming to secure member benefits and reduce risk”.

Altman said that with nearly half of schemes fully funded, insurance-based solutions are becoming more accessible and attractive due to the certainty they provide.

She explained that this “rising demand” is reflected in market activity, with deal volumes expected to approach £40bn by year-end and suggested that “all signs point to continued momentum”, as schemes look to “lock in” timelines and move forward with transactions.

“The security afforded by this strategy is crucial for trustees and sponsors who are preparing to wind down their DB pension schemes,” she continued.

“It’s clear that buy-in is not just a tactical move – it’s a strategic decision that aligns with long-term goals, removing uncertainty and allowing trustees to lock in member benefits.”

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