Self-managed buy-in solutions

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What is the next stage in the evolution of your investment strategy towards your de-risking endgame?

Evolving your de-risking strategy to include longevity hedges, transitioning assets to be more cashflow aware and increasing the focus on a more diverse range of high-quality credit assets as funding levels improve can help you to reach your endgame with more certainty. We call this a self-managed buy-in (SMBI).

A self-managed buy-in: an efficient path to your endgame

While an insurance buy-in may be perceived to be beneficial, it can increase the target returns required from the remaining ‘free’ assets, make liability hedging more challenging and/or increase the expected timeframe for achieving a buy-out.

A SMBI approach may provide greater value for money than a conventional insurance buy-in, with similar characteristics but at a lower cost, and help to provide greater flexibility to deal with unexpected events which cannot be hedged.

Related materials:

  • An objective assessment of the impact of a buy-in: Make a more informed de-risking choice by considering a wider range of factors. Hamish Watson, UK HR Director at ScottishPower, also describes their de-risking journey. 
  • Introducing LE01: With input from industry experts, we have developed a measure of liability exposure to help you manage the impact of future longevity improvements
  • How to hedge longevity risk: Read how Insight’s longevity platform can help you achieve an effective and efficient longevity hedge while maintaining flexibility for the future
  • An SMBI overview: What is a self-managed buy-in and how can it help reach your endgame with more certainty?
  • Addressing the funding challenge: Log-in to our November Client Training session to hear our CEO explain how investors can reach their endgame with greater certainty
  • Comparing buy-outs and buy-ins: Buy-outs and buy-ins differ fundamentally in three ways: their purpose, practicalities and potential investment impact. Consequently, the analysis you should conduct when considering them needs to be different.

Helping you make a more informed de-risking decision

There is no single de-risking solution that is right for all schemes. To help you make a more informed choice, we present a series of short videos from industry practitioners and Insight experts:

  • Andrew Clare: Professor of Asset Management (Cass Business School)
  • Huw Evans: Independent trustee (BESTrustees)
  • Pádraig Floyd: Former trustee (Pearson Pension Plan)
  • Gavin Hill: Trustee and Chair of Investment Committee (Yorkshire and Clydeside Bank Pension Scheme)
  • Heneg Parthenay: Head of Insurance
  • Jos Vermeulen: Head of Solutions Design
  • Ren Lin: Head of Client Strategy and Innovation

 

 

(2:37 min)

(2:37 min)

Andrew Clare, Huw Evans and Gavin Hill discuss what are the biggest influences on the endgame.

Learn more
(2:21 min)

(2:21 min)

Gavin Hill, Huw Evans and Pádraig Floyd discuss which factors are commonly underestimated when schemes de-risk.

Watch now
(0:46 min)

(0:46 min)

Andrew Clare discusses how the industry can help stakeholders make a more informed de-risking decision.

Want to know more?
(2:36 min)

(2:36 min)

How can pension schemes use an objective analytical framework to assess whether to pursue a buy-in or a self-managed approach?

Watch now
(1:50 min)

(1:50 min)

How can schemes assess an insurance buy-in and how does it compare to a self-managed approach?

Find out more
(2:49 min)

(2:49 min)

There is no single de-risking solution that is right for all schemes. To help you make a more informed de-risking choice, we present views from Heneg Parthenay, Insight Investments’ Head of Insurance.

Views from Insight

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  • 2004 Insight launched its financial solutions capability
  • £665.3bn in assets managed by our fixed income and financial solutions groups
  • £97.1bn assets managed for cashflow-aware clients

As at 30 September 2019. Assets under management (AUM) are represented by the value of cash securities and other economic exposure managed for clients. Assets managed by our fixed income and financial solutions groups include clients who have liability driven investment, fixed income and cashflow-aware strategies.

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Important information

The value of investments and any income from them will fluctuate and is not guaranteed (this may be partly due to exchange rate fluctuations). Investors may not get back the full amount invested. Past performance is not a guide to future performance.

Derivatives may be used to generate returns as well as to reduce costs and/or the overall risk of the portfolio. Using derivatives can involve a higher level of risk. A small movement in the price of an underlying investment may result in a disproportionately large movement in the price of the derivative investment.

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