Trustees and Mercer speed up bulk annuity deals with teamwork

Mercer’s DB Master Trust executed three bulk annuity buy-ins within weeks this year, a speed that would have been impossible just a few years earlier.

Activity in the bulk annuity market has surged. Consultants tracked a record 350 to 375 transactions in 2025, with smaller and mid-sized schemes leading the way. Transactions that once took months now often close in weeks, thanks to improved workflows and shared knowledge.

The transactions were overseen by Mercer’s risk transfer team, working alongside the master trust’s independent professional trustees, PAN Trustees, Independent Governance Group, and Zedra, along with legal support from Stephenson Harwood. The trustees’ prior experience with buy-ins allowed the process to focus on critical decisions rather than foundational explanations.

A key innovation was conducting a data cleanse before finalizing contracts. This preparatory work, coordinated with Mercer’s advisers and Just Group, simplified later stages and provided trustees with immediate clarity on costs, which are usually confirmed only after data verification.

By consolidating three fully segregated sections of the master trust into a single transaction, Mercer achieved better pricing and insurer capacity than would have been available for individual schemes. This strategy also shortened the period between buy-in and buyout, accelerating the trust’s progress toward winding up.

The increased pace has required pension schemes, trustee boards, and advisers to adjust. Stephenson Harwood launched its Derisking Pathway, a standardized framework for faster transactions. The program uses pre-approved disclosure templates and AI tools to accelerate document review, while standardized contracts and benefit specifications minimize redundancy and reduce costs.

Estella Bogira, a partner at Stephenson Harwood, described the collaboration between Mercer, Just Group, and the trustees as exceptional. The process emphasized member outcomes, with all parties coordinating closely to optimize the approach. Tim Ball, Mercer’s lead for the DB Master Trust, observed that while the master trust was designed for efficiency, this deal established a new pathway for employers transitioning through it toward buyout.

Mercer’s transactions reflect a broader movement: as more pension schemes approach their final stages, trustee boards face growing options. The consistent factor across all deals remains effective teamwork. Insurers, consultants, and trustees must align their efforts to keep up with a market that operates at an unprecedented speed.