2025 Pension Risk Transfer Market Update 

The 2025 figures¹ from the pension risk transfer market show yet another strong year, with plan terminations accounting for a growing proportion of total transactions. However, legal scrutiny of fiduciary insurer selection decisions persisted in 2025, impacting market dynamics.

The pension risk transfer (PRT) market closed 2025 in a strong position, overcoming a slower start to end the year with nearly $49 billion in premiums transferred — marking the fourth consecutive year exceeding $45 billion.

After a muted first half, during which litigation concerns and jumbo deal hesitancy tempered activity, transaction volume accelerated significantly in the second half of 2025. In total, approximately 750 transactions were completed. Notably, the fourth quarter accounted for a substantial portion of annual premiums, underscoring insurers’ renewed appetite and sponsors’ readiness to execute.

For the first time in modern PRT history², full plan terminations surpassed retiree liftouts in total premiums transferred. They also once again led in deal count, with 440 transactions representing nearly 60% of completed deals.

We have seen improved funded status across many corporate plans which has enabled sponsors to move beyond partial derisking and pursue full exits from the defined benefit system. At the same time, retiree lift-outs remain an important tool, particularly for sponsors taking a phased approach to liability reduction.

One of the most notable developments in 2025 was the rapid growth of buy-in transactions. Buy-ins accounted for more than one-third of total premium volume, totaling over $17 billion across 20 transactions, a significant increase from prior years. Plan sponsors are increasingly drawn to buy-ins as a mechanism to lock in insurer pricing and secure capacity earlier in the termination process.

The increase in market volume was supported by greater insurer participation. Currently, 22 carriers offer group annuity contracts for transferring qualified plan liabilities, with additional new entrants exploring the market for 2026. This expansion of capacity contributed to competitive pricing, particularly in the latter half of the year, as insurers sought to deploy capital and meet growth targets.

We expect the PRT market to maintain strong momentum. Insurer capacity remains robust, competitive pressures are likely to persist, and plan sponsors continue to evaluate derisking opportunities in light of favorable funded status.

In our view, pension risk transfer remains a powerful tool in the defined benefit toolkit. In an environment characterized by arguably improved funding, expanded insurer capacity, and heightened fiduciary scrutiny, successful execution will depend on early planning, disciplined governance, and clear alignment of stakeholder objectives.

_{¹ The stats within present analysis derived from Mercer's Quarterly Insurer Pension Risk Transfer Sales Report as of 12/31/25}

_{² Modern PRT can be defined as since the year 2012}