More longevity swaps are expected this year as the price of hedging drops, especially for smaller schemes, according to Willis Towers Watson senior consultant Shelly Beard.
2016 was a relatively quiet year for longevity swaps, with only £2bn of pension scheme liabilities having been hedged, Beard noted in a recent paper.
She explained that this was because significant longevity reinsurance capacity had been taken up by transactions for insurers rather than pension schemes.
Solvency II has made it very expensive...
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