Artex Assist Airways Pension Scheme In Pension Longevity Transaction

Oct 04, 2017


4 October 2017

Artex Risk Solutions (‘Artex’) has been selected by Airways Pension Scheme (‘APS’ or the ‘Scheme’) to provide insurance management services for the administration of APS’s newly established, Guernsey-based insurance company. Artex was previously selected by BT Pension Scheme to establish and manage their Guernsey based insurer.

APS has established the insurer to underwrite longevity risk, which will protect the Scheme against costs associated with potential increases in life expectancy. APS has transferred longevity risk to the insurer, which has in turn reinsured this longevity risk. By using a wholly owned insurer, the Scheme was able to access capacity in the global insurance and reinsurance market. Additionally, Guernsey’s Incorporated Cell Company legislation was utilised to establish the insurer, which provided a cost effective platform for the transaction combined with flexibility for the Scheme in relation to any future requirements.

Paul Eaton, Business Development Director of Artex, said: “APS had previous experience with longevity swaps, but after careful analysis determined that for future transactions the use of an insurer would offer significant cost and control advantages. A considerable amount of time was spent planning for this transaction, and a key element of the project involved the consideration of where to establish the insurer.”

He added: “Guernsey was identified as the ideal jurisdiction having both modern and well-regarded insurance legislation combined with a mature financial services infrastructure and a well-reputed, business-focussed regulatory regime. The selection of the insurance manager was another key decision, and I am delighted that Artex was able to demonstrate to APS our experience, expertise and operational capability to partner on this project.”

Merise Wheatley, Director and project leader at Artex for the establishment of the APS insurer said: “It has been a great experience to work on this transaction, which makes best use of Guernsey’s strengths as a captive domicile, and I am delighted that Guernsey continues to lead the way in longevity captive transactions. Myself and the rest of the Artex team are delighted that this has been launched successfully to provide APS with long-term longevity risk protection.”


About Airways Pension Scheme
APS was established under a Trust deed dated 8 October 1948.

It is a UK defined benefits scheme and provides retirement benefits for employees (and their dependants) of BA and some of its subsidiary and associated companies.
APS was closed to new members at 31 March 1984. As at 31 March 2015 APS had 27,268 members and dependant pensioners, and net assets of £7.5 bn.

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