How to navigate the array of DB pension risk transfer options 

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Welcome to this, the first in a series of videos where we explore some of the key questions facing trustees and sponsors when considering whether to explore a transfer, which options are most applicable to their schemes, and how to secure the best deal. Over the course of the series, we'll be gaining insights from a variety of industry experts, including professional trustees, insurers, reinsurers, and consolidators.

And if pensions wasn't already glamorous enough, we've shoehorn some of the biggest questions in risk transfer into some very well-known movie quotations. See how many you recognize. For the first video, I'm delighted to welcome Shehz Ahmed, a hugely experienced pension trustee from Ross. The title of this webinar is "I'm going to make him an offer he can't refuse." But there are now so many different options available to schemes these days. So Shehz, how do you, as a trustee, navigate the range of options and decide between a multiplying array of offers?

What is it we're trying to achieve through risk transfer? Is it moving financial risk to a different vehicle? Or, indeed moving your operating risk to a different operating model? Working collaboratively between trustees, sponsors, and advisory teams is really important to answer that question. You have to also look at what the market has to offer because there's an array of options out there. And working with people, the risk transfer experience is really important.

From a trustee perspective, it's about securing member outcomes. But you can extend that to alternative strategies that has upside sharing mechanisms as well. Solutions such as buyout with insurers, captives, consolidators, couples of journey plans, or indeed, a run-off strategy that is a bespoke strategy for a scheme, is all viable but yields different results for different parties. Once you know where you're headed, look at the operational risk, the financials, the cost benefit analysis. But always remember to keep the member outcomes at the forefront of your mind.

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