Most Plan Sponsors with De-Risking Goals Intend to Divest All of Their Company's Pension Liabilities in the
Future, MetLife Poll Finds
2018 was another robust year for pension risk transfer (PRT), and new poll results from MetLife indicate that plan sponsors’
interest will continue to grow in the near future. MetLife’s new 2019 Pension Risk Transfer Poll, released today, found that more
than three quarters (76%) of defined benefit (DB) plan sponsors with de-risking goals intend to completely divest all of their
company’s DB plan liabilities at some point in the future, with 33% intending to do so in the next five years.
“The Poll findings indicate a trend in increased pension risk transfer activity as we anticipate plan sponsors will want to
proactively deal with the cost and volatility of their plans,” says Wayne Daniel, senior vice president and head of U.S. Pensions
at MetLife. “As a result, many will begin to look more closely at the $3 trillion of DB plan liabilities that have not yet been
de-risked and begin to evaluate how they can address this.”
Preparing to Act
Many plan sponsors have already taken steps to prepare for de-risking. For the 67% of plan sponsors considering a risk transfer
within the next two years, the Poll found that 77% have evaluated the financial impact of a pension risk transfer, 74% have held
discussions with key stakeholders, 65% have engaged in data review and cleanup, and 59% have explored the solutions available in
the marketplace and/or quantified the cost of a pension risk transfer.
Plan Sponsors Keen on Annuity Buyouts
A majority of plan sponsors surveyed (79%) are more likely to consider an annuity buyout now that there have been several large,
well-publicized instances of major corporations entering into annuity buyout deals with insurers. Annuity buyouts continue to grow
in popularity, with two thirds of plan sponsors (67%) saying they will use these solutions to de-risk, an increase from 57% in
MetLife’s 2017 Poll results, and up 21 percentage points since MetLife’s first Pension Risk Transfer Poll in 2015.
Structuring Buyouts
The Poll found that the majority of plan sponsors intend to tranche transactions by participant population: the most common is
retirees, with 54% of plan sponsors looking at this group, followed by terminated-vested participants at 43%. Only one in three
(30%) say they would secure a buyout for all participants.
About the Poll
The MetLife 2019 Pension Risk Transfer Poll was fielded between August 13, 2018 and September 27, 2018. MetLife commissioned MMR
Research Associates, Inc. to conduct the online survey in cooperation with Strategic Insight, which owns PLANSPONSOR and CIO
magazines. Survey responses were received from 102 defined benefit (DB) plan sponsors with de-risking goals. This included 52% of
plan sponsors who reported DB plan assets of $500 million or more, and 48% with DB plans that are at least 90% funded (including
21% that are fully funded). The full report examining these findings is available at:
www.metlife.com/prtpoll2019.
About MetLife
MetLife, Inc. (NYSE:MET), through its subsidiaries and affiliates (“MetLife”), is one of the world’s leading financial services
companies, providing insurance, annuities, employee benefits and asset management to help its individual and institutional
customers navigate their changing world. Founded in 1868, MetLife has operations in more than 40 countries and holds leading market
positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, visit
www.metlife.com.
Judi Mahaney
212-578-7977
jmahaney@metlife.com
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