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Blog The bulk purchase annuity (BPA) market remains buoyant in 2026, with improved funding positions enabling more schemes to approach insurers. However, from an insurer perspective, not all opportunities are equally attractive. This article explores the current BPA landscape and outlines what insurers should look for when assessing opportunities and why well-prepared schemes stand out.
The Current BPA Market Explained
A UK bulk purchase annuity is an insurance policy that a defined benefit pension scheme buys from an insurer to help secure members’ benefits. It is a key mechanism through which insurers assume pension liabilities, requiring careful pricing and risk assessment, as it cedes either all or a portion of scheme responsibilities to insurance providers. There are two main forms of BPA:
- Buy-in: The pension scheme purchases the Insurance policy, while retaining responsibility for paying members. The insurer pays the scheme, and the scheme continues to pay members as normal. Importantly, the insurer assumes the risk associated with pensioner payments.
- Buyout: The insurer takes over responsibility for paying benefits directly to members and assumes full responsibility for the liabilities and ongoing administration of the scheme. Members become policyholders of the insurer rather than remaining in the pension scheme.
At present, competition among insurers is strong, with well-prepared schemes better placed to attract insurer engagement. Given that insurer engagement with schemes below £100m was notably high in 2025, smaller schemes in particular may now be well-placed to take advantage of competitive market opportunities.
For insurers, each transaction represents a balance between deploying capital efficiently, managing longevity and investment risks, and selecting opportunities that can be executed with confidence. As transaction volumes increase, insurers are becoming increasingly selective, prioritising opportunities that align with their risk appetite and operational capacity.
Why Scheme Preparation is Important for Insurers
In a competitive BPA market, preparation can make a material difference. Here are some of the tangible benefits you can expect to see by preparing your pension scheme in advance of transactions.
Greater data confidence
Poor or incomplete data introduces uncertainty, which insurers must either price for or spend time resolving, potentially reducing competitiveness or delaying execution.
Take benefit histories, for instance. When insurers take on liabilities, it is in their best interest to have visibility of what benefits each member has built up over time and how those benefits have changed. This kind of clearly evidenced data increases scheme credibility and allows them to make evidence-backed decisions.
Time savings
In a capacity-constrained market, insurers prioritise opportunities that are straightforward to assess and execute. Cleaner data and complete documentation means insurers spend less time resolving uncertainties and more time assessing the opportunity itself.
More efficient transactions
WTW has noted that BPA transactions often require significant data cleansing and insurer-specific data extracts. For insurers, efficiency in execution is critical. Transactions that require significant data cleansing or clarification increase operational burden and can impact pricing timelines and internal resource allocation.
Reduced execution risk
From an insurer perspective, execution risk directly affects pricing confidence and capital allocation decisions. Schemes that have already addressed gaps in data, processes, and governance are less likely to encounter unexpected issues when they go to market. For pension software supplier Mantle, readiness means being able to demonstrate clear benefits, solid audit trails, and reliable management information, alongside the ability to execute without surprises.
What Insurers Should Look for in a Scheme
A well-prepared scheme is one that is organised, accurate, and operationally ready to go to market. It is best practice for insurers to assess the following factors when evaluating scheme readiness:
1. Accurate member records
Insurers need confidence that member data is complete, validated, and reliable in order to produce accurate pricing. Mantle’s no-code calculation engine allows insurers manage scenarios such as dual records and evolving scheme data.
2. Clear benefits and audit trail
Clarity enables insurers to assess liabilities without needing to make conservative assumptions, which can otherwise impact pricing
Benefits should be well documented, easy to trace, and supported by clear records of decisions, calculations, and any changes over time.
3. Reliable management actions
Insurers rely on consistent, high-quality management information to understand scheme dynamics and price risk appropriately.
This includes data on membership movements, retirements, deaths, and contingent beneficiaries, enabling insurers to build an accurate picture of liabilities and support robust pricing decisions.
High-quality administration and actuarial systems can generate data quality assurance reports, reducing uncertainty and streamlining insurer review processes.
4. Proven operational readiness
Beyond data quality, insurers assess whether a scheme can respond reliably and efficiently throughout the transaction process. This responsiveness is particularly critical during pricing and exclusivity phases, where delays can impact timelines, pricing confidence, and overall deal certainty.
Use Mantle Software for Your BPA Journey
From an insurer perspective, schemes that can demonstrate operational readiness are easier to engage with, assess, and progress – making them more likely to be prioritised in a competitive market.
Mantle’s bulk purchase annuity software centralises the entire journey in one place – from pricing through to buy-in and buyout. Its integrated actuarial capability supports initial pricing and valuation at a scheme and portfolio level, with Control, visibility, and auditability built in for ease of access.
Book a discovery call with us today to see Mantle in action.
