Pension Risk Transfer Digest
Winter 2025
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Business Stats
F&G's PRT business is growing significantly. See our sold premium, won deals and lives onboarded as of December 31, 2024.
Interest Rate Update
See how interest rates trended between October and December 2024, and what it means for PRT pricing.
Did You Know?
How do insurers ensure a smooth transition for retirees after a PRT transaction?
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Here's a look at our sold premium, won deals and lives onboarded as of December 31, 2024. Check out our Q4 2024 earnings for more on F&G's business performance.
Total sold premium:
Total number of won deals:
Total lives onboarded:
1 F&G internal PRT business data as of 12/31/2024. Number of total lives onboarded does not include beneficiaries.
Competitive pricing is a key component of product success. PRT pricing is correlated with changes in high-quality corporate bond yields (consistent with how pension plan liabilities are valued for funding, accounting, etc.) and changes daily based on yields available to the issuing PRT insurer. Rate increases and spread widening drive lower PRT cost — and vice versa.
Yields increased during this period, which translates to an approximately 4.5% lower PRT transaction price. Any increase or decrease in PRT transaction pricing would be generally consistent with a similar increase or decrease in the pension plan liability, which is similarly determined with a high-quality bond type discount rate.
This chart covers Oct - Dec 2024 and shows how interest rates changed during that time period.
1 Information shown above is illustrative and not intended to represent F&G's actual PRT transaction pricing. Historical interest rates are not indicative of future rates.
2 Single effective rate based on U.S. Treasury yield curve and AA corporate bond spreads from sample PRT liability cash flows during the period of October 1, 2024 to December 31, 2024.
PRT administration: ensuring seamless transitions
When a plan sponsor transfers pension obligations to an insurer, pension risk transfer administration ensures a smooth transition for retirees through:
- Clear communication that welcomes retirees to their new insurer, details their benefits and provides ways to access resources and support
- Ensuring payment amounts are accurate and on time to maintain retiree confidence
- Accessible call center or web-based support so retirees can manage their accounts and resolve issues
- Smooth processing of retirement elections, including direct deposit, beneficiary designations and survivor benefit updates
- Generating and distributing accurate 1099 forms to retirees and answering tax-related questions
Administrative services can be managed internally by the insurer, or outsourced to a third-party provider. The goal of either method is the same: to provide a seamless transition and accurate, timely ongoing service for covered annuitants.
Internal administration
offers insurers greater control over the process, allowing them to align operations with their existing systems and oversee communications, payment processing and retiree support. However, it takes a significant investment in technology, staffing and expertise.
Outsourced administration
relies on the expertise of third-party administrators who specialize in PRT. These providers offer scalable solutions and advanced technology. Insurers can benefit from their proven processes for handling payments, customer service and tax compliance, often reducing operational costs and enhancing the retiree experience.
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Describe your role in PRT.
I am a new business pricing actuary. I prepare the inforce data, underwrite mortality and price bids for both preliminary and firm rounds. When we are selected in a bid, I provide the necessary documentation to the Valuation and Modeling teams. I also work on projects that allow us to enhance our pricing tools and processes.
What brought you to F&G?
The summer of 2022 I interned at F&G on the PRT Pricing team. I quickly grew to enjoy the work I was doing, the people I was working with and the company I was working for. At the end of that summer, I was offered a full-time position on the team that I was eager to accept! I've now been working here for 2 years.
Favorite aspect of PRT?
My favorite part is that it is transactional. I've always worked well under pressure, and the fast-paced, time-sensitive nature of bids creates an environment I can thrive in. But the most unique part is that it is both repetitious and dynamic. I price each bid using a very similar process. This allows me to quickly enhance my pricing skills and business knowledge. However, the quick turnarounds and sheer magnitude of bids keep it dynamic and exciting.
How do you spend a typical Saturday?
I have a lot of travel plans in 2025! This year I'll get the opportunity to visit Texas, Arizona, Utah, Colorado, Idaho, Oregon, Washington, Canada and Montana with my two dogs. Because of this I don't expect I'll have many "typical" Saturdays — I'll be packing, traveling or exploring new areas.
Favorite book, podcast or show?
If I'm reading, it's usually an actuarial exam manual. And instead of listening to podcasts, I am often listening to music (and probably singing a lot louder than I should!).
We'd Love to Hear From You!
More About Our Team
F&G’s PRT team is a seasoned group of professionals who specialize in business development, pricing, investments, operations, legal, finance and reinsurance.
Our team collaborates with F&G corporate staff and external PRT consultants and their clients throughout the year as we work to manage new and in-force PRT business activities.
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This material is intended for informational purposes only and is only intended for use by institutional plan sponsors and industry professionals.
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F&G is the marketing name for Fidelity & Guaranty Life Insurance Company issuing insurance in the United States outside of New York and, in New York only, Fidelity & Guaranty Life Insurance Company of New York. Each Fidelity & Guaranty Life company is solely responsible for its contractual commitments.
Guarantees are based on the claims paying ability of the issuing insurer, Fidelity & Guaranty Life Insurance Company, Des Moines, IA.
