Buy-out and Risk Management



We can help you with:
  • identifying the key risks – schemes are typically exposed to risks such as sponsor risk, investment risk, inflation risk and longevity risk.  Understanding the extent of the risk currently being taken in each of these areas is a fundamental first step to determining an appropriate risk budget.

  • managing investment risk – understanding the impact of the pension scheme’s investment strategy on the company’s balance sheet and the cash cost, including the potential use of swaps and other investment products to manage risk and discussing the company’s view on the investment strategy with the trustees.

  • assessing longevity swaps – we have conducted detailed research into this nascent market and developed a market-leading bespoke longevity tool to help sponsors assess the exposure of their schemes to longevity risk and consider the effective price of entering into a longevity cash flow swap or longevity index hedge.

  • analysing and implementing liability reduction exercises – we have long experience of conducting enhanced transfer value exercises, exchange of pension increase exercises and early retirement exercises to generate optimum levels of liability and risk reduction.

  • analysing and executing a buy-out or buy-in – our specialist buy-out team has advised sponsors and managed dozens of pension schemes through a wide variety of buy-in and buy-out processes since 1999, focussing on meeting our clients’ specific needs in a timely and cost-efficient manner.


 Insights & views

    New regulatory guidance on employer covenant
    2 October 2015

    ​In August 2015, the Pensions Regulator published new guidance entitled “Assessing and monitoring the employer covenant”. In this insight, we consider the key messages of the new guidance and what it means for trustees and sponsoring employers.

    Read full briefing note here

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    Will FRS 102 increase your PPF levy?
    16 September 2015

    ​The size of your PPF levy is influenced by the insolvency risk of the sponsoring employer. This insolvency risk is assigned by Experian which takes information from the employer’s financial accounts. The switch to accounting standard FRS 102 for pension accounting this year could worsen the balance sheet and hence increase the PPF levy.

    Read full bulletin here

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    Aligning PIPs with the tax year
    10 September 2015

    ​In his summer Budget on 8 July 2015, the Chancellor of the Exchequer announced that the period over which pension savings are assessed for annual allowance (AA) purposes (the pension input period or PIP) would be aligned with the tax year, as part of further restrictions on the AA. This briefing note looks at the consequences of this change.

    Read full briefing note here

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    Tapering the annual allowance
    10 September 2015

    In the first Conservative-only Budget for nearly two decades, the Chancellor announced that the annual allowance (AA) would be tapered down for high earners from 6 April 2016. This note looks in detail at how the taper is calculated and when it will apply.

    Read full briefing note here

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    Balancing the past and the future
    3 September 2015

    ​Two publications this summer highlight the challenges that trustees of defined benefit (DB) schemes face, in terms of both looking ahead to the future and managing the legacy of the past.

    Read full bulletin here​​​​​

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    Visit the Industry Insights page for news and views on the latest industry developments


    Pensions: where next?
    21 October 2015
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    Implications of the Budget Pensions Changes
    5 November 2015
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    Getting Ready for Your Next Pension Scheme Valuation
    26 November 2015
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    Visit the Events area for all forthcoming Punter Southall seminars, conferences and events
    Speak to us

    Speak direct to our specialists in this area
    Neil Lalley
    Head of Employer Services
    Or call us on
    020 3327 5000