The UK bulk annuity's market reached new heights in 2023 with an estimated £50bn ($63bn) in market volume, comfortably exceeding the previous record of £43.8bn in 2019.

Insurance and pensions consultancy Barnett Waddingham wins the pension risk transfer (PRT) innovation of the year award for the key role it has played in growing the sector.

The consultancy has advised on £4bn of liabilities transacted in the bulk annuity market during the past year, including 15% of the market in the first half of 2023. It has worked with its clients to secure large deals, such as a £900m buy-in with the Thomas Cook pension fund, alongside a range of smaller deals.

Over the last two years Barnett Waddingham has also expanded its risk transfer team to seven partners and over 25 staff to help its clients meet the challenges of a high volume of insurance deals and new propositions in the capital-backed space.

Since the UK's Pensions Regulator approved the first capital-backed superfund in 2021, another achievement for Barnett Waddingham is that it has worked with its pension scheme clients to identify a suitable candidate for the first transaction with a superfund.

This came to fruition in November 2023, when it advised on the first ever superfund transaction, for the £590m Sears retail pension scheme with Clara Pensions.

Richard Gibson, actuarial consulting partner at Barnett Waddingham, tells InsuranceERM: "With the improvements in DB pension scheme funding levels leading to record UK bulk annuity market volumes in 2023, we expect this trend to persist – or even increase – in the coming years. Provisional estimates already place bulk annuity activity at around £50bn, with the potential for other areas of pensions risk transfer to also meaningfully contribute to volumes during 2024.

"However, there are headwinds with the government keen to explore how pension scheme assets can be used to support 'UK plc' and we expect to see greater regulatory pressure for large schemes to run on without transferring to insurance."