Author: Samuel King
FOR PROFESSIONAL INVESTORS ONLY
This article is a financial promotion and has been approved on 07/21/2026 by Gallagher (Administration & Investment) Limited, who is authorised and regulated by the Financial Conduct Authority.
What recent acquisitions and strategic partnerships mean for the UK Bulk Purchase Annuity market
Over the past 12-18 months, the UK Bulk Purchase Annuity (BPA) market has seen a notable increase in mergers and acquisitions (M&A) activity and strategic partnerships between insurers and global asset managers. While headlines often focus on changes in ownership, the underlying theme is insurers strengthening their capital position and assetorigination capabilities to remain competitive in a market where pricing, capacity and execution certainty are critical.
Below we explore the most significant recent developments and explain why they matter for UK defined benefit (DB) pension scheme trustees and sponsors.
Consolidation is reshaping insurer ownership — but not insurer appetite
A clear trend over the last year has been consolidation through acquisitions, particularly involving insurers. For example, Brookfield Wealth Solutions completed its acquisition of Just Group in April 2026, and Athora Group completed its acquisition of Pension Insurance Corporation (PIC). Utmost Group has also agreed to the sale of Utmost Life and Pensions (including its BPA business) to JAB Insurance, with completion expected in 2026. In each case, the acquiring party has emphasised its intention to support continued growth in BPA, rather than withdrawing capacity from the market.
While a change in ownership naturally prompts questions around covenant strength and longterm commitment, these transactions are largely about scaling and supporting BPA businesses, not retrenchment. Trustees should expect continuity of quoting activity, but with an increasing focus on insurers backed by larger pools of longterm capital that can support future volumes and execution certainty.
Global asset managers are becoming central to BPA strategies
Alongside outright acquisitions, insurers are increasingly forming strategic partnerships with global asset managers to enhance access to suitable longdated assets.
A prominent example is Legal & General's (L&G) strategic partnership with Blackstone, announced in July 2025. Through this partnership, L&G can access Blackstone's c. $465 billion private credit platform, predominantly focused on investment-grade assets suitable for backing annuity liabilities. Similar themes can be seen elsewhere in the market. These arrangements are designed to supplement insurers' inhouse capabilities rather than replace them, giving insurers greater flexibility in sourcing assets that meet Matching Adjustment requirements.
BPA pricing is driven not only by the scale and nature of liabilities but also by the availability of suitable longdated assets to back them. Insurers with stronger asset origination capabilities (such as enhanced access to private credit and other illiquid assets) have more flexibility in constructing their investment portfolios and are therefore better positioned to price competitively, particularly for larger or more complex transactions. For schemes, this can translate into more attractive pricing and greater insurer appetite, especially at times when public markets are constrained.
Acquisitions and strategic partnerships strengthen asset sourcing capabilities
Whether through acquisition or partnership, a common objective is improving access to longterm growth capital. Assetmanager partnerships can provide access to deep origination pipelines across private markets and BPA owners such as Brookfield, Athora and JAB bring both the asset-management strengths as well as bringing capital.
All this matters in a BPA market that continues to absorb very large transaction volumes and where schemes are increasingly wellfunded and ready to transact. Insurers with stronger capital backing are better positioned to maintain competitive pricing across a wider range of deal sizes, support multiple transactions in parallel and provide greater certainty of execution for schemes running to tight timetables.
Counterparty strength is about more than current solvency metrics. The ability of an insurer to deploy capital efficiently for the long term is critical, particularly for full buyout transactions. Furthermore, stronger insurer capacity can mean greater choice, improved pricing tension and smoother transaction execution.
Private credit is becoming increasingly important — but governance remains key
A notable feature of these developments is the growing emphasis on investmentgrade private assets. Private credit, infrastructure debt and other illiquid assets can offer higher returns than public bonds while still delivering predictable cashflows aligned to annuity liabilities. However, regulators continue to scrutinise insurers' use of illiquid assets, particularly in relation to Matching Adjustment eligibility, risk management and transparency.
Trustees should expect to see greater differentiation between insurers based on asset strategy and governance. While enhanced assetorigination capabilities can improve pricing, it remains important to understand an insurer's investment and risk management framework, how private assets are sourced, monitored and stresstested, as well as how these strategies support longterm policyholder security.
Strong advisory support remains essential to ensure that pricing benefits are properly weighed against counterparty and operational considerations.
Looking ahead
The recent wave of M&A and partnerships reflects a structural shift in the BPA market towards insurers refining their strategic approach to the market. For UK DB trustees and sponsors, this evolution is positive, supporting capacity, competition and innovation. However, it also reinforces the importance of careful insurer selection, early preparation and informed duediligence as schemes move towards buyin and throughout the buy-out process.
If you'd like to discuss how these developments could affect your scheme's endgame strategy, please contact our expert team, or speak to your usual Gallagher contact.
Important notice
This article is for Professional investors only; it is generic in nature and should not be regarded as providing specific advice or a recommendation of suitability. No action should be taken without seeking appropriate advice. There can be no guarantee that the opinions expressed in this article will prove correct.
