AXA completes £2.8bn longevity swap with RGA

The AXA UK group pension scheme has completed a £2.8 billion longevity swap deal with Reinsurance Group of America (RGA).

The swap covers pension cover 11,000 pensioners in AXA’s defined benefit section and provides long term protection to the scheme against costs resulting from pensioners living longer than initially expected. It covers around half of the scheme’s liabilities.

Stephen Yandle, chairman of AXA UK Pension Trustees, said: “I am delighted to announce that the AXA UK group pension scheme has taken an important step to ensure that our defined benefit scheme members’ benefits are strongly secured against continuous improvements in life expectancy.

“By significantly de-risking the scheme, this will benefit all our DB scheme members and will not affect any payments to members as they will continue to receive their pension as normal. This is a very positive step in providing additional security of members’ pensions.”

Cormac Galvin, vice president, RGA UK, added: “RGA is delighted to support AXA in reducing risks within their pension obligations through this transaction. As a global leader in the underwriting of mortality and longevity risks, RGA remains committed to supporting insurers in managing risks inherent in longevity portfolios.”