Pulled - Strategic credit for your path to DB buyout – abrdn

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As defined benefit (DB) pension schemes approach the crucial milestone of buyout, trustees must manage scheme asset volatility relative to the likely cost of the transaction. This strategic focus helps protect the scheme from market moves that could reduce the affordability of buyout.

Insurers typically maintain a high proportion of credit within their investment portfolios. By mirroring this strategy, DB schemes can hedge insurer pricing more effectively and reduce cost at the point of transaction. This can involve refining the type of credit your scheme holds, to align your portfolio with insurers’ credit investment practices.

abrdn take a look at the most important credit considerations from an insurer’s perspective, and discuss the strategic relevance of these factors for DB schemes.

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Pulled - Strategic credit for your path to DB buyout – abrdn

Constructing an insurer-friendly defined benefit credit portfolio.

Only members with restricted access (ie. academics, asset owners, government and regulatory, independent advisers/trustees and sponsoring employers) can view this article. Please login or join to view.

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