LONDON, March 6 British insurer Aviva has
agreed to transfer the risk of members of its staff pension
scheme living longer than expected for 5 billion pounds ($8.37
billion), the largest ever such deal.
Longevity swaps, which involve a pension scheme hiving off
the risk that pensioners outlive expected life-spans to
insurers, form a growing market amid rapidly increasing life
But the Aviva swap is the first of its kind in that it is
transferring the risk directly to a number of reinsurers
directly rather than going through a single insurance company
which would traditionally act as an intermediary.
"The trustee is delighted to have taken another important
step in our ongoing process to improve further the level of
security of all our members' benefits," said Sir Ian Prosser,
chair of trustees for the Aviva Staff Pensions Scheme, in a
statement on Thursday.
Aviva's transaction represents more than half of the total
8.9 billion pounds of longevity swaps in 2013.
The deal was brokered by Hymans Robertson and Linklaters.