Rothesay Life strikes pension deal with British Airways

by Gill Montia

Story link: Rothesay Life strikes pension deal with British Airways

Rothesay Life has announced that it is insuring £1.3 billion of the pension liabilities of the Airways Pension Scheme, one of two defined benefit schemes sponsored by British Airways.

The policy provided by the Goldman Sachs subsidiary covers some 20% of the pension payments due in respect of scheme members already in receipt of benefits.

The liabilities are covered by an arrangement that allows the Trustees to retain ownership of the scheme’s assets, while Rothesay Life claims the proceeds and in return pays a portion of pensioner benefits.

According to the insurer, “the arrangement provides the highest degree of security for the scheme and its members”.

Rothesay chairman, Keith Satchell, says: “Another pension scheme sponsored by a FTSE 100 company has selected Rothesay Life as their preferred insurance provider.”

He adds: “Rothesay Life has insured in excess of £3.5 billion of pension liabilities in the last twelve months, confirming our leading position in the UK pension scheme buy-out market.”

A year ago, the company completed a transaction that involved insuring£1.9 billion of pension liabilities of the UK pension schemes of RSA.