Smiths Group secures £146 million buy-in with Canada Life

This follows a £176 million buy-in with Canada Life last year, and a £142 million buy-in with Aviva and the TI Group Pension Scheme

The Smiths Industries Pension Scheme has secured a £146m buy-in with Canada Life in its fourth bulk annuity and its sponsor’s tenth overall.

The £3bn scheme conducted an auction process to take advantage of strong pricing throughout the turbulent markets.

The buy-in follows a £176m buy-in with Canada Life last year, and a separate £142m buy-in with Aviva and the TI Group Pension Scheme, another sponsored by Smiths Group, earlier this year. Across the two schemes, around 71% of pensioner liabilities are now de-risked.

The trustees and sponsors were advised by Aon, using its Compass platform, and Redington.

Trustee chairman Nicholas Godden commented: This is another well-timed step in our de-risking strategy, adding further to member protection despite a challenging market environment. Thanks to our advisers and to the group's continued support, the scheme is well-positioned for the steps to come.

It is Canada Life's first announced bulk annuity this year, although it has also completed a £1.4bn longevity swap with the UBS (UK) Pension and Life Assurance Scheme.

Annuity sales director Nick Flynn said: In these times of global uncertainty, it is very positive for the scheme members that we can provide certainty as we further develop our relationship with the Smiths Industries Pension Scheme through this buy-in.

Aon risk settlement adviser Dominic Grimley added: Through extra planning, this transaction was designed to fit the circumstances we face in lockdown. This meant the focus was firmly on straightforward execution and price capture, while opportune timing also enabled a gain to be made against the scheme's funding target.

Around £18.5bn of UK pension benefits have been announced as insured this year so far.