Right. Good morning, everyone, and welcome to our webinar on how to get the best terms for your small scheme buying. Thank you very much for joining. It's great to see so many of you listening today. So I'm David Stewart, I'm a partner in LCP's pension risk transfer practice and I specialize in helping small schemes secure their benefits with insurers. For the purpose of this webinar, while define any small scheme as one that is under £200 million. To help small schemes, I designed LCP streamlined buying service back in 2011 and we'll be talking a bit more about that later on. So in recent years I've been commenting on how the bulk market is getting busier, resulting in smaller schemes having to work harder to gain insure engagement. Indeed, transaction numbers have increased by over 50% in the last few years and much of this increase has been driven by demand from smaller schemes. The good news is that multiple insurers are willing to quote on smaller schemes if schemes prepare themselves and approach the market in the right way. And indeed there are a number of new entrants who have appetite for smaller schemes which will help improve the competition. One of those new entrants is Royal London and I'm delighted that I'm joined by Frankie Brown. Frankly leads the bulk community origination team at Royal London, so he's in the perfect position to talked about Royal London's The Other Market and what Royal London looks for when deciding whether to cope for your scheme and what helps them put forward their best price. I'm also joined by my colleague Sarah Gunn. Sarah is a Principal in our pension risk transfer practice and she will talk to you about some takeaways from Frank's talk in the form of actions that you should be taking to prepare yourself in the most attractive way. So I'm going to start with a few housekeeping points and then I wanted to do a quick poll. So be prepared to click on your thoughts. Firstly, questions. If you have any questions you would like us to answer, please get in touch. On the screen there should be AQ and a box where you can submit all your questions. Don't worry, your personal details are not on display to the other the rest of the audience, so please feel free to ask away. We will do our best to answer as many of these questions at the end of the session or either come back to you separately. Second, in the box labeled Useful Sources, we've put a link to our latest Pension Risk Transfer report. You'll also find a guide to LCP streamline service to buy and buy us. There is also a call to action box which provides info on our Pension Risk Transfer forum which we are open in on January. Lastly, the webinar platform has lots of buttons and useful information. Please feel free to click and explore these. So on to the poll. Let's do the poll. So when when I last presented a Webdar on small scheme binds a couple of years ago I had a poll asking you what you thought was the biggest challenge facing your scheme for being able to ensure. So I thought it would be interesting if you have the same poll and see if your users changed. This time I've added a couple of extra ones. You'll need to Scroll down the list to see all the items, but please click on all the options that you believe are most relevant to you. I'll give you 30 seconds or so to answer that. Please don't forget to click the submit button when you've ticked the ones that are that are appropriate to you. And Dave just thought everyone's answering the questions on the screen. Maybe we could pick up a comment in the chat. I've just got a question here. Dave, can you define what you mean by small in this context of this? So small are transactions under £200 million here. Thank you. Still waiting for ones to come in, so please don't forget to click your submit button for putting forward the results of the poll please. Here we go. The numbers are now ticking up quite nicely. That's really good, I'll give that. Give you another 5 or so seconds. Right, that looks like a good chunk. Let's move on to see what the results are. So where have we got so well, I remember last year that the key results were data and benefits. Interestingly, benefit issues have gone down a bit, but that could well be because I, I introduced the Virgin Media as a separate one to click on. But data quality still seems to be the, the, the key one for scheme. So Sarah, well, if I can ask you to comment on how to improve data quality when you go through your bit later on in in the presentation. Right, Let's move on to the next slide. So before I hand over to Frank and Sarah, I was going to provide an update on the current bulk annuity market itself. So let me just look on to this slide. So let's have a look at what we think demand will be for pension schemes going forward. So for a few years now we've been estimating projected bulk annuity volumes so that you might have seen this chart before. It's quite heavily used within the industry. So on this chart, the blue bars show the actual transaction volumes in recent years. So last year reached a record 49 billion and we think this year will be around 45 billion. But what is the biggest issue for smaller schemes is what will demand in future years and could this cause smaller schemes difficulties in getting quotes? The Gray bars here show the projections we made last year. We're expecting volumes to peak over the next three to four years. Pink bars show our revised projections. These revised projections reflect our view that we don't believe total demand will change, but we now believe there will be a delay from scum schemes you choose to run on for a period before moving to full insurance. So overall, the projected volumes are broadly unchanged, but there is a smoothing of when this is expected to arise. Ultimately, we think that from a demand perspective, this is good news for small schemes, at least over the next two to three years as we expect it will be less of the smaller schemes that choose to run on the material. Reduction in volumes compared to expected for 20/24 had quite an interesting impact on pricing, which I will cover shortly. But I wanted to look at the number of schemes that go into market 1st. So at the top of this slide we look at the number of transactions over the past four years. As you can see the number of transactions have increased very significantly, but you can also see that this growth in numbers is coming from a smaller end of the market with the numbers of mid sized and large transactions remaining relatively stable. This huge increase in numbers have meant that insurers need to be a more efficient when processing quotations and the particular growth in smaller schemes transactions has fueled insurers to develop their own streamlined positions. So just as developed Beacon, Aviva, Clarity Legal and General Flow and Pick has put forward Mosaic. This is all led to insurers being able to cope with increased volumes of requests and importantly for smaller schemes has resulted in increased competition. At the bottom of this slide, we show our graph or ensure participation rates. You can see from the graph there's been a doubling of participation rates over the last year for smaller schemes and except for the very smallest schemes, all those that have complex benefits, the days of being forced into exclusive processes with one insurer are gone. So what does this increased competition mean for pricing? So this graph shows how insurer pricing has developed over recent years. It shows the implied yield of a buying relative to the euro gilts. The pink line shows a return from a typical pensioner population and the Gray line shows a return from the tip called the third population. Very simply, the higher the lines, the more favourable the pricing. The keynote here is that the pricing material improved in the second-half of the year and this is the first time other than in a crisis. The pricing for the third members is better than gilts flat. So typical scheme now can achieve buying pricing of gilts plus 20 basis points. So that means that you can transfer investment longevity and other risks to an insurer or at a saving relative to the cost of a low risk skill based investment strategy. But what have been the drivers for this? Well, firstly volumes they were down in the first half of this year, which has resulted in an increased competition with more insurers on average in participating processes. Secondly, with credit spreads at historic lows, some insurers have been investing in gilts and baking in an expectation that these will switch, they will switch into higher yielding assets over time. And then thirdly, we've seen continued improvements in reinsurance pricing particularly for non pension members. So while I was looking at pricing, I just wanted to at this point the spell a couple of minutes. Firstly, I hear people saying that pricing is not as good for smaller schemes and and honestly that is just not true. Provided that smaller schemes robustly prepare and then obtain a competitive process, we see prices for smaller schemes consistent with that of large schemes, and this is reflected in the graph that I'm showing you. Secondly, I hear people saying that to get the best price, you need to give an insurer aggressive price target. However, what has happened with pricing this year shows the dangers of doing just that. If you're always setting price targets, you won't see any improvement in the pricing coming through. We saw one example this year where trustees set supposedly aggressive price target, but this was actually 8% higher than market pricing results of insurers taking part easily hitting that target. Providing targets based on updating information can hand additional premiums to insurers at the expense of even members of the sponsor. So going back to this chart, what does that all mean for smaller schemes? Well, put simply, your scheme may be closer to full bout funding than you realize and it's now is probably the best time we have seen in recent years for bringing the school scheme to market. Sarah will be setting out some actions that you can take to see if this is the case, but my message is now is the time to kick the tires of the estimates that if you've been given by your advisors. So the question I always get is Dave, bring out your crystal ball and tell us whether pricing will improve or deteriorate. I can't give you that answer, but what I can tell you is that competition is set to increase. Now. This is because we have new entrants all looking to enter the market. The graph here shows the history of insurers in the market going back to 2005. This year we have both Royal London and Upmost into the Volcano market and the expectation is that Brookfield will enter the market next year. This will bring the number of insurers in this market up to 11, the highest it has ever been. With Upmost, Royal London and Brookfield all interested in smaller schemes, the level of competition is looking very attractive for the smaller end of the market. This is an important development as at the small end of the market over recent years has become dominated by just two insurers. That is just an Aviva. The graph on this slide shows the market share by number of transactions for transactions under £100 million Aviva and just on 74% of the transactions on the £100 million in the 12 months to June 2024, increasing to a massive 93% for those transactions under £10 million. I thought most in rural London have started to transact in the second-half of this year and it will be interesting to see how they impact this market share. So that leads me nicely on to hand over to Frankie to hear about Royal London and what would attract them to your scheme. Thanks, Dave, and good morning, everyone. So over the next 15 minutes or so, I wanted to cover 3 areas with you. First of all, I'd like to give you a brief overview of Royal London, including reasons to see our proposition differently to other insurers in the market. Secondly, I wanted to give you some insights into our first bulk community transactions that we've completed and importantly where we see our target market as we head into 2025. And then finally, I'll step through how we think when triaging transaction opportunities, particularly in the context of the sub £200 million market. So starting with a high level overview of rural London. I appreciate that many of you may be familiar with our brand or or even have bought one of our products in the past, but we are new entrants in the Balkan U.S. market. And so we fully appreciate that trustees and their advisors will want to scrutinize our business and Balkan US offering. And that's actually something we want to embrace as we think we've got a powerful and differentiated proposition. Royal London is EU KS largest mutual in the life pensions and investment sectors and we're actually the only mutual operating in the bulk community market. So, So what does that mean in reality? Well, in a nutshell, we don't have any shareholders or private equity investors, and instead we exist solely for the benefit of our members and policyholders. So I'll circle back to our mutual mutuality in just a moment. As a group, we've been around since 1861 and we have 8 and a half million policy holders. And I suggest that's important for two reasons in the context of this market entry. Firstly, hopefully demonstrates that we have deep and varied experience and taking excellent care of our customers. And then second, it means that we have the systems, processes, people and economies of scale that mean that we're crossing the start line at speed as we deliver in the on boarding, buying and buyout phases. But what makes us different in the buying settings? Well, we'd highlight three key points. First of all, it's that unique status as a mutual. Other insurers will always have a natural tension between maximizing returns for their investors whilst also delivering good outcomes for their policyholders so they can continue to sell more business. As a mutual, we can take decisions through a different lens in areas like member care, sustainability and beyond. And so far we've found that that undivided focus resonates with many trustees and that mutual mindset does allow us to think differently. Our focus in this market is about putting quality of delivery ahead of quantity. Over the next decade, we might expect to write 1 to 2 billion of buying business each year. So that's a lot of money in most settings, but very modest in the context of a market that, as Dave just outlined, is writing 50 billion of business each year. That's because we want to prioritize an excellent customer experience ahead of the ever more stretching sales targets. And then finally, a great example of that mutual mindset in action is where we have chosen to retain RDB administration in the house that ensures we're fully in control of quality and fully accountable to our Trustee clients. We're the first new entrant provider in this market in 20 years to choose not to outsource our admin. And we suggest that in part, it's our status as a mutual that gives us the freedom to do that despite it not being the cheapest or easiest route. Coupled with that is as a new entrant, we don't have a congested backlog of dozens or even hundreds of transactions in the buying phase that are all jostling for the position in an insurer's queue for buyouts. And I just want to spend a couple of minutes on our recent transactions and target market. So in terms of transactions completed, we've done 5 today covering over 775,000,000 of premium. That includes 2 transactions with our own Royal London Pension schemes and three with external pension schemes. We're actually delighted that our 1st 2025 transaction is already in exclusivity. So those early transactions have been very helpful in testing and refining our processes, but we've had happy trustees and advisors in each case, which is obviously been great to see. And the biggest challenge we face sitting here today is providing comfort to trustees around our Royal London branded track record in this market, which is limited to those recent 5 transactions. And transacting with a new engine won't be right for every Trustee board. But we have found that when trustees get a sense of our teams extensive Balkan US experience, they do get comfortable with us as a partner pretty quickly. New entrants will typically be came to lean in on pricing and they're wider proposition and that's of course no different at all London. We'd suggest that our early clients have got some great pricing. Ultimately, we want to first and foremost compete on price and then hopefully have a really attractive wider proposition sitting behind that too. So a great example of us leaning in as a new entrant was £100 million transaction in September. That was AUK pension scheme but with some Irish based members who are paid in euros. So that's not a regular feature and it does introduce complexities in areas like admin power, payroll and and tax. But we felt it was an opportunity for us to really step up and collaborate with the trustees and their advisors to deliver a tailored solution. So looking ahead to next year, we'd like to engage on any potential transaction in the premium range of 30 to £500 million that can cover any mix of pensioners and deferred members. We're focused on that size of transaction because we feel that it's where we can price most competitively whilst delivering our mutual LED proposition to a good range of pension schemes in the years ahead. In the next 12 months we do plan to develop and launch a streamlined transaction model like those that they've mentioned just a few minutes ago and that will allow us to also actively participate in the 10 to 30,000,000 LB transaction range. Right? So now I wanted to turn our attention to discussing how we treat our smaller pension scheme quote request and how to get the best possible outcome for your own pension scheme. The important context here is that the 10 soon to be 11 active insurers in this market are extremely busy. Pricing up a pension scheme for a buy in transaction is a huge undertaking. And ensure it is in essence performing a complicated actuarial valuation from a standing start and then having to convince that governance committee that this particular decades long risk is right for their business, all in a matter of weeks. So that doesn't mean that insurers are selected around which Trustee boards they engage. And even as a new entrant, we're already turning down to in three quote requests that come our way. But the good news is getting this stuff right, it's not rocket science. If you follow the playbook and have a resettlement consultant like LCP who knows this market inside out, then you really will succeed. So in terms of triage, we look for similar factors to other insurers in this market and they are set out on the left hand side of the side in front of you. So let let let's step through each of them in turn. First up is affordability. So when I was at LNGA few years ago, I was working with one Trustee board who saw their affordability jump from a 15% shortfall to a surplus in less than a week. That was March 2020 as COVID really took hold and spiked credit spreads, which in turn dramatically reduced insurer pricing. So not everyone's going to be as fortunate in funding their buying premium. So if you have a shortfall and demonstrating that this has been accurately estimated by your advisors and your corporate sponsor has all the governments in place to meet any shortfall with a sensible amount of contingency is key. And that neatly moves me on to governments. So it's a Trustee board and a corporate sponsor. You need to show that you have all of your governments in place to move swiftly through the quotes and transaction phases, ideally by forming a joint working group or JWG. So the last slide I showed actually had Royal London's 5 bulk annuity state, it should be 6. So we got within a few days of signing a £40 million transaction in October, everything was ready. But when the sponsor was asked for their final sign off, they checked in with their parent company and after some delays we're told to put the transaction on ice. So we still expect to transact that one early next year. But it's a great example of why client side governance is critical. So third of my list is member data and benefits member data is likely to be the number one factor which guides how quickly you can get to market. The 5000 or so defined benefit pension schemes in the UK have historically managed with member data that has varying degrees of inconsistencies and gaps. Buyout providers just require a higher standard of data to meet their requirements. That's both in terms of pricing the insurance risk, but then also going on to administer those policies for decades into the future. A few years a few years ago an inexperienced advisor sent me some member data that didn't even have dates of birth in. So that's all thing happens very rarely, but meeting the minimum levels of quality is important, otherwise you'll get turned away and then insurers will be less engaging next time you appear with a data quality they need in terms of spouse existence and date of birth data. Doing a write out to your members to collect up to Firstly, it means insurers can typically be less prudent around their spouse assumptions, and 2nd, it gives insurers confidence that you're approaching the market in a prepared and orderly way. In terms of a member benefit specification, make sure your legal and risk settlement advisors have prepared a full insurer friendly benefit specification. The odd consultant still issues specifications talking about discretionary benefits with no clear direction for insurers. What you're asking the insurer to ensure should be black and white and your risk settlement advisor should take you through an exercise to discuss and codify any discretionary benefits. The 4th 1 is around the invitation to quote or ITQ document that your resettlement advisor will send to insurers alongside your member specification and member data. First of all, make sure you have one as it's your chance to showcase all of the work that's been done getting ready for market. But do keep it concise and and do the work upfront to decide what is important to you in terms of additional quote requests and keep them limited. One helpful thing you can do in this area is to work with a resettlement firm who has a pre negotiated contract agreed with the insurers. That means that you know that you're going to get attractive legal terms and it means the insurer knows they won't have to spend time and resource negotiating the contract. My fifth one is around your assets and having them in an insurer friendly state. This ideally means that they're all liquid in nature and ready to be sold either to fund the premium or to be paid to the insurer as part of a in specie asset transfer. So liquid assets aren't an insurmountable barrier in the smaller transaction market, but ideally they are dealt with before approaching the insurers. But if they can't beat their, most insurers, including Royal London will be happy to engage with some element of the Fed premium for for say a couple of years. The other thing that insurers may look out for is that your assets are well hedged against insurer pricing. We won't don't want to get close to signing the contract only to realize that affordability has moved against you due to changes in financial market conditions. Then finally on my list is the post transaction phase. The on boarding and buying phases are just as important in many ways as the pre transaction phase. At rural London. We want that phase to be as proactive, collaborative and moving out pace as possible, so demonstrating some early planning here will go down well with us. It has to be said that you shouldn't underestimate the value of a high quality advisor. Bringing real credibility. Of course, TO Insurance will work with a wide pool of consultants over the course of a year, but working with someone you trust to get the transaction done does count for a lot when you're sat around that table in the weekly triage meetings at an insurance company. It's worth saying that we don't require exclusivity like some other insurers. We know that we can compete on price and appreciate that some competitive tension can be important. But we will want to know how many insurers are involved, say any more than three total for a transaction of up to around 100 million. And we probably look to use our limited resource elsewhere. Something which is a bit unique to Royal London is us being particularly attracted to Trustee boards who demonstrate that they have taken the time to understand our proposition, including our status as a mutual and they're attracted to working with us. We ultimately want to work with those Trustee boards who want to work with us and we'll definitely lean into those situations. With that, I'll hand over to Sarah. Perfect. Thanks Frankie and hi everyone, I'm Sarah. So as Dave said, it's a busy market for small schemes at the moment and the LCP, we've LED hundreds of transactions of all sizes, including over 200 small transactions. So what this means is we've really been able to fine tune what schemes need to do to get the best engagement pricing and terms as well as the smooth process. So what I want to do in the next 15 minutes for you is to distill this into 5 tips I recommend you take to get the best outcome for your scheme. So tip #1 gain a clear understanding of how close you truly are. So as Frankie highlighted, you need to demonstrate insurers that you've got an accurate buyout pricing estimate and if there is a shortfall that the employers indicated, they'll fund it. So basically they know you're not wasting their time if actually a transaction is clearly unaffordable. So how do you know how close you are? Well, for many schemes, the statutory solvency estimate from their scheme, actually they may be the only indicator they have readily to hands. So that's the dark blue bar on the screen. The problem with this is that it may actually not be a good indicator of where true insurance pricing is, as the assumptions may be out of date, data may be stale and also it might have actually been set without reference to much live pricing. More of that in a moment. So recently on our cases, the trend has generally been that the schemes tend to be much closer to buy out than their incumbent scheme actually had thought seen some as much as 10% different. So this would be my next blue bar on the screen. So how does LCP know where insurer pricing is at any point in time? Well, as well as monitoring the market indicators, what makes LCP different is that we have insight on hundreds of transactions across all segments of the market, both large and small. And we use this to set more reliable and up to Now say you do still have a deficit at the moment and can't afford to come to market straight away. My tip to you is that you should still ask your Pensioners Transfer advisor to help you get a Clearview but also to help you understand how you might bridge that deficit in future and what that would look like. So just to show you here in the pink bars we have as an example, you might close the deficit because you may have company contributions that would be funded into the scheme. You may also naturally close the deficit over time because pensioners are cheaper to ensure than non pensioners. So as the scheme matures and time passes, you might close the deficit through that point alone. Separately, you might have some investment returns which could help you. And lastly, as Frankie's highlighted early, you might also get lucky with the market opportunity, meaning you could afford to buy out sooner. So I'm saying though that for both the investment and the market opportunities, you are running risk and these factors could go for or against you. So for this reason, it's really important that you continuously review the position regularly. Now, as you can see from all these pink bars have contributed to a buyout deficit in three years that's much lower than it is now. At some point, it'd be low enough that you would be able to fully buy out. Now it's tempted to say, fine, let's just wait until that happens and then it's the right time to come to market. But a word of warning all the while, while you wait for the buyout position to close, the scheme will be incurring ongoing expenses, illustrated here in the orange bar. Especially for very small schemes, it's not unusual that the expenses building up may actually outweigh the benefit you get for waiting a fuse to ensure. So if this is you, you might actually be better off to come to market sooner from a pure economic perspective. Subject of course isn't being supposed to do so by the company. So my first tip for successful transactions starts before you even approach the market. It's get a credible estimate from your pension risk transfer advisor and way up when to come to market in light of all the costs, including ongoing expenses. That brings me on to tip #2 be clear on stakeholder governance upfront. Now, doing a buy in is one of the biggest decisions many Trustee boards will ever have to make, and it will involve a number of different stakeholders. So you need to get on the front of governance first. You need to agree your objectives and how you'll measure if they're met before doing a transaction. It's our job as your pension risk transfer advisor to help you understand all the options out there and if doing a buy in really best meets your needs. Now given we're on a webinar about small schemes buy insurance, let's assume you came to the conclusion it is. The next most important thing we'll look to do is to help you agree the key objectives and insurer selection criteria for your Trustee boards and the other stakeholders. Many transactions will have certain objectives in common, but the full list will vary between schemes, some placing more weight on ESG credentials, other being very, very focused on how administration might work at the insurers. So having set your objectives, we will help you decide on how you evaluate if they've been met. This could, for example, includes commissioning independent due diligence reports on ESG financial strength, administration capability or even doing things like meeting the insurers and quizzing them on their offering and business strategy. Moving on to the next tip on governance, make sure we involve the key decision makers before coming to market. Frankly starts on this, but we also generally recommend that you form a joint working group including company representatives. It's also really, really important that you identify those company key decision makers early on and any key governance hurdles there are at outset. It's then our job is your transaction project manager, that we include all those key meetings in the project's plans and diarize key decisions around them. And also that we make sure that any governance hurdles are aired early by the company as part of the joint working group. Lastly, on governance, make sure you've got the right mix of skills in your Trustee board. So a small scheme doesn't mean that these transactions might not be complex and involve very difficult decisions along the way, including ones which could have involve conflicts of interest of those on your board. So when considering governance structure, you may want to consider bringing on a professional Trustee in general as part of the discrete part of the project. This can be really been official because professional trustees bring a wealth of prior experience from other transactions and so help with those complex decisions. Also, because they're independent and have an objective perspective they could bring to the board, we often work with first trustees and personally often a lot of transactions where I've seen real value of having personal Trustee on board. So depending on your circumstances, this might be something worth considering. So to wrap up, guess your governance right at outset is vital for a successful transaction. And as Frankie said, insurers will be asking you questions to make sure you've got your docs in a row on this. Moving on to my next tip. Tip #3 undertake insurer focused preparation, so demonstrating you're well prepared on data, benefits, investments, really important to get your scheme prioritized. Also for you to avoid any extra surprises or unexpected costs further down the track. So with that in mind, here's three things we do for our transactions. The LCP which are really, really important #1 ensure the materials and requests aren't sure appropriate. So typically your benefit specification may have been drafted by your lawyer, but it will be a pricing team who'll need to pick it up and interpret it to code up your quote. Key possible our processes is to review the benefit specification through an insurer lens, make sure it's clear, it's simple and complete. We also look at your options for benefits, which you may struggle to ensure for a small scheme. So for example, salary link benefits, this is some. So you make sure upfront you know that there aren't any blockers which are going to prevent you from moving to buyouts and wind up in future should you want to. So I'm saying that the benefits specifications, a document that doesn't tend to change much or at all really unless you change your benefits and can also take quite a long time to prepare. So regardless of when you go to market now or in a few years, this is a key step that would be good to get ahead on if you want to buy out at some point in the future. Next, do the checks and insurer would. So having poor quality data and not being being given the information they need, it's really frustrating for insurers as Frankie's just told us. So as part of all our processes, we'll do the same checks and insurer would do to avoid this happening for our scheme. So we'll make sure data is complete makes sense consistent with the benefit specification. And we also drafted data specification that marries the two documents up. We also identify if there's anything supplementary that could be provided to help them improve their pricing, pay you as low premium as possible. So for example, doing a right I exercise for spouses and marital status. Now doing these checks gives the insurance the confidence that your scheme is in a good shape. It cuts down time on insurer queries, but also it helps out flush out any data issues. And conscious of the data quality was a key concern for many of you on the call today. That brings me on to my last point on this slide. And that's around blockers. So having data benefit issues doesn't need to be a blocker to doing a transaction because you do have the opportunity to cleanse data or adjust data and benefits post transaction within the contract. So for example, GP equalization, you would be able to do post transaction under the contract. But what's really important is that as part of the market approach, you need to decide. And that's something we'd help you with as a pension transfer advisor is help you decide whether you'd be better off taking the time cleansing the dates now and then coming to market. Or actually if you would be able to identify what needs doing and highlight to insurers at outset what you'll be doing and the time scales for cleansing post transaction for both of these. And it's really, really important that you get an accurate cost estimate of how much these issues will be to rectify and also that you can so you can include that in your buyout costs, but also that the insurer is going to get comfortable that the changes aren't so material that they might invalidate their original pricing basis. So just to summarize, data quality doesn't need to be a reason not to come to market, but you need to have a really clear plan and you need to be very thoughtful about it. Lastly, just on liquid assets, Frankie's touched on this as well, but I know there are some on the call here that have a liquid assets and that that might be a concern. So I think there are lots of different options out there, different solutions for liquid assets. So again, it doesn't necessarily need to be a blocker to buy out. So if this is you drop us a question in the chat and we can then should make sure we get back to you if you're want to explain a little bit more on the solutions there. Moving on to my next slide on #4 So in order to put their best pricing forward, insurers need to have conviction that you're a scheme with the high likelihood of successful transaction. So your invitation to quote is the first thing they see of you, and it's key that you have all the right points in that. Present your business case as strongly as possible as to why they should prioritize you as a small scheme over many others. So in this, you should demonstrate all the points we've been talking about today. Your prep work, your governments, no blockers. You've done the work on affordability, but also importantly that everything is in place to get a transaction done successfully, including clear timelines when decisions are being made. Mises have been diarized partly also because having all these key milestones set out early on helps the insurers plan that resource around you. Another point here, to echo Frankie, is that as a small scheme who's never transacted before as part of your business case, you'll want to leverage off the good reputation your advisor has with the insurers. So to summarize, especially as the small teams coming into a busy market, make sure you demonstrate a compelling business case that gives your deals team everything they need, all the ammunition to go into their triaging meeting to win an argument to put your scheme ahead of others. On to my last tip, right, right approach to market, consider a streamlined service. So Frankie's mentioned that having a streamlined service with pre agreed contract is a key attraction for insurers. Now at LCP, we also have a streamlined service and we're actually one of the first advisors to put that in place back in 2011. We generally recommend that this is an option for schemes up to 200 million, but we have done transactions bigger and we have in fact use it for transactions as small as 2 to only two million. So this service was specifically designed to make small schemes more attractive for insurers and more straightforward for trustees and sponsors. As part of this will make sure you do all those rights, strategic and proprietary steps that I've talked about earlier to ensure you've got some smooth transaction. We've got pre negotiated contracts and they provide you with better and more Trustee friendly terms compared to ensure sure standard contracts. That they're similar to contracts available for much larger transactions. The service also includes legal advise on the contracts from Gowling's, which is a law firm we've partnered with for the service. And having these pre negotiated contracts has a cost perspective from terms of the premium. As Frank has already said, you insurers are able to put through lower premiums because they save on not having to on cost of their lawyers. And also for you, you don't have to waste time and money going through protracted contract negotiations. That's all done upfront. Benefit of this process is it's got much shorter time scales, meaning you could transact within just three months from approaching the market, again giving much higher transaction certainty. And lastly, most importantly, the insurers really like this process. And even at the very, very small end, we continue to be able to run competitive processes with multiple insurers quoting. And so for example, since the beginning of 2023, so when the market got really busy, as they've talked about earlier, the small ends, we've had over 85% of our cases here, still have had multiple insurers quoting key driver for this high insurer engagement is that we've got a really good track record with this proposition. So as you can see, we've done nearly 100 transactions and over 4 billion liabilities secured. And this smooth experience and track records gives the insurance the confidence they need that if you come to them as a small scheme through LCP streamline service, this will be yet another successful transaction. So that was my last top tip, consider a streamline service when approaching the market. Now to wrap up, these were the five areas I recommend you focus on to get the best outcome for your scheme. So I'm saying we see different approaches out there when it comes to small schemes, But with LCP having done hundreds of transactions at the small end, to us getting the best price, best terms and smooth transactions simply comes down to not cutting corners on preparation, being really thoughtful about how you approach insurance and how you give them confidence that you're a successful transaction ready to happen. And lastly, using a streamlined approach, set your theme up to get better pricing and terms akin to a much larger transaction. With that, I'll Passover back to Dave. Sarah, thank you for all those tips. And then you can definitely tell it's getting near Christmas because there are gremlins in the system. I don't know if people saw that we lost Frankie there for a minute, but I'm glad to say he is back with us and a good job too because Frankie, a lot of the questions that have come in seem to be a dress your way. Maybe maybe if I can just start with that, that the first one that we had. Frankie, is there anything in the transaction process or indeed about your BPA product that is different for scheme below £100 million in asset versus scheme with assets between 100 million and 500 million? Sure. Thanks, Dave, you can hear me OK, Can you? I think my video might be good. I will keep going. Yeah, great. Thanks for the question. So I think the first thing to say with that one because it's important for completeness is whether you're purchasing a smaller sub 100, sub 200,000,000 LB bulk annuity or a bigger bulk annuity, you're buying exactly the same product. So you're getting all of the sort of good risk protection, the admin services etcetera. It is the same product across the premium range. I mean in, in terms of process for Royal London as we sit here today, the process looks very similar for all of the schemes that we engage with. So those in the sub £200 million bracket or or any bigger ones for that matter. But as flagged we are looking to develop a a smaller scheme proposition over over the next year as as Dave has highlighted, there are a few of them already in the market. I think from Royal London's perspective, we really are starting from a, a blank sheet of paper. You know, over the last few months as we've entered this market, spoken to lots of advisors and trustees. You know, a number of people have remarked to us that, you know, these are streamlined propositions from other insurers. But for who? I mean, the answer of course is that they're streamlined to the insurers. And therefore actually, you know, sometimes they have cons as well as pros for, for the trustees and the advisors that that need to, to engage with them. So really, as we begin that journey over the next year, we, we want to collaborate with advisors and trustees and make sure that the proposition that we develop isn't, doesn't sort of sleepwalk into one of our competitors propositions. It needs to be right for, for everyone. And I guess sort of circling back to that sort of quality over quantity piece that I, I mentioned once or twice, we at Royal London are not developing a streamlined solution so that we can go and write another 30 or 40 transactions. Actually, if we get it right and just are able to support, you know, another 10 to 15 clients in pound premium range, then we'll see that as success. Right, Frankie, in case we lose you again, I'm going to fire another one at you if that's OK. So and then and then I'll give you a break if things are going well. So another one, what percentage of assets is the Max that you would accept as a liquids by any limits on time size of the third premium? Yeah, sure, sure. So I guess what I'd say first of all in that one is that in my experience every illiquid situation with a pension scheme is different. You know, I've come across sort of a dozen specific situations and all of them have been different in terms of, you know, the quantum of liquids, the nature of those liquids, how they're sort of composition across different liquids. You know, how the trustees and corporate sponsor who, you know, an important voice at the table are thinking around potentially a transaction disposal of those assets. So I don't think the, you know, speaking on London's behalf, but probably for other insurance as well. I don't think there's any hard and fast rules around the quantum of the liquids. Typically insurers are going to be looking at other other character characteristics. So how easy is it to do the due diligence that you need to as an insurer to really understand those liquid assets? Because sometimes it can be relatively straightforward and sometimes it can be very complex to form a full picture of what that electing asked to sort of take on the risk of it into the future. The second bit is around risk appetite as an insurer. And this will interestingly differ between insurers. So just by the very nature of insurers having different risk teams, having different investment teams in terms of the appetite. So you know, I think the liquids in your scheme, it's definitely work. What where the sort of pockets of interest will likely be and then the final ones around pricing. So you know that in my experience that's always a difficult conversation. Obviously, insurers would like to take the liquids on it the lowest possible valuation to maximize the chance that they're not going to make a loss where it's actually, you know, trustees and Corp responsible is understandably want to sell the those assets to an insurer for as close to sort of full value as as possible. Sort of moving on to the deferred premium bit. I mean, you know, give some guidance. I think most insurers in this market would typically be happy to defer say up to sort of 20% of the premium for, for two or three years. And, and that's certainly true for Royal London. And you know, if there was a situation where either of those sort of limits needed to be pushed a little bit, then, you know, that's a conversation we, we definitely want to have. I guess just as a bit of background, I mean, I, I haven't seen any insurers engage in a deferred premium over 30%. And the reason for that is that the way this, this, these deferred premiums are structured is that the, the deferred premium is basically, you know, supported by the bulk annuity. So if that deferred premium isn't paid, that and the insurer has the right to scale back the benefits under the buying policy. So I, I've got no awareness of that ever happening that a Fed premium is, is always paid. But obviously in that situation, insurers don't want to push the the amount of deferred premium too high. We, we are getting your sound cutting out a couple of times, Frank, just so you're aware, but I think everyone got the got the answer to that one to give you a break and we've had one and I think that probably throw this one over to Sarah, quite an interesting one here. Sarah, looks like there's an overseas parent and the question is, is how do we get the overseas parent to engage fully in in doing a buying transaction? Yeah, nice. I'll take that one. Yeah, interesting question. I guess also because especially if you're very small scheme, which I can assume lots of people call art can sometimes really be difficult to get the engagement overseas parent. It's schemes very small in context of the wider business. And so you might have to work a bit harder to get corporate attention. Think in terms of what I'd recommend here. There's a couple of things we've seen work really well and it's essentially just to formulate like an economic business case of why you want to do this step. So bringing out things like the cost benefit analysis, so the buyout cost versus the capitalized expenses of running on the amount of risk reduction here and also see if you were to buy in and then to move to buy out that it would be removing liability from the balance sheet could be very helpful to get their attention, especially in context of something like an M&A. I think also to other ways to get them engaged. Also it's important that you bring out the key asks or other factors that will be important to them. Things like accounting treatment, would you need anything like a company indemnity as part of the project or you know you might need cash for them? And in order to do this transaction, I think also worth bearing, I think the question was specifically about overseas parents, that actually the UK DB industry operates very differently to different pension museums around the world. And so actually the parent entity might be not very familiar about the UK pension industry. So especially you're in that situation, you might need to go through a bit more of a process to explain what you're doing and why and what you need from them. Thank you, Sarah. So I, I've got a question here which I'm I'm happy to pick up myself. It's a, it's a follow up question really in terms of what my definition of small that I said earlier on and it really says in terms of definition of thought any, any thoughts on transactions of 50 million and less. And what, what I would say is that actually, I think the average transaction size that we complete on the streamlined service comes out to about about £40 million. So the pricing that we've shown you today and the processes that we've talked through and, and what we do to increase competition and, and engagement from insurers I think is exactly what a, a, a, a sub £50 million scheme would do. And I think fair enough when you get to the larger sizes, maybe, maybe insurers a little bit more forgiving, but we'd say still follow the type of processes that we've been talking through. OK, Frankie, let's, let's see if if your sounds OK and just try you with another one here. So this is, this is a question about about what you said earlier about your mutual status. So it says if we transact with Royal London, will the scheme members become members of Royal London and share in Royal London's profits? Sure. Yeah, happy to take that one, Dave, if you can. You can still, yeah, you can tell him. So Royal London profit share is actually only provided to a minority subset of Royal London's eight and a half million policyholders, so that they're known as our sort of members in adverted commas. And we, we don't currently have plans to grant that sort of membership to buy our policies and buy out members. And that's primarily on the basis that these policies are written. So you know, as we all know, all benefits are guaranteed to match the fine nature of the DB benefits. So we sort of are matching that within a sort of traditional Balkan unity policy. And as hopefully outlined, I mean, we really see the power of mutuality as having that sort of undivided focus on on members and policy holders and, and not that tension that that, that, that I've spoken to. And I think, you know, we would highlight that that has the potential to become more acute in the sort of 10 to 15 years as this market begins to cool down and these buying books of business insurers, you know, in effect become sort of stand alone back books. And and by association that must mean that the sort of commercial rationale to invest in members care directionally has to has to reduce. So, yeah, to sort of summarize, at the moment, there's no plans for sort of a profit share bulk annuity policy, but hopefully lots of value beyond that in terms of our mutuality. OK. And I think given the time, we've probably got time for one more question. Let's just I guess Frankie, not one for you given sounds working. So the first five transactions you've done, what would you say is your biggest learning point from, from, from those? Yeah, really, really interesting question. So, so I, I joined the business back in July. So have seen the three external transactions that we've done sort of first hand. And I have to say, you know, that they've gone smoothly and, and that sort of, you know, testament to, to people winning Royal London, but also the advisors and trustees that have been involved. They've been very collaborative processes. But I, I think sort of the, you know, the, the learning that springs to mind, it's sort of, you know, the power of getting in front of Trustee boards and talking to them directly about their specifics of their pension schemes. I mean that's something that I personally have always sort of enjoyed throughout my sort of 12 or so years in this market. And it's definitely something that we have done on all of the processes that we've completed, but also those that are in exclusivity. And I just think that opportunity to first hand and give time to to understand across the table or virtually or in person around what what's important to the trustees. So that's definitely something that we're keen to continue to do into the future. Right. Let's, let's just leave things there the moment. So I'd just like to end this with our key takeaways. So mine is pricing is at very attractive levels, providing that your small schemes robustly prepare themselves and achieve a competitive process. Competition between insurers looks set to increase, while demand looks like it has plateaued. And this really does suggest a very attractive time for your small scheme for getting great pricing and terms. Frank, Sarah, Frankie, your key takeaways? Yeah, thanks, Dave. I mean, my mine is probably have a, a backup plan for your Wi-Fi if it drops. The, the, the, the the two that I'd highlight is, you know, make sure you have an advisor that you trust to get all of that preparation done properly so that, you know, when you go to market, you feel really confident you're going to get that, that great result that you deserve. And then the second one is also really take the time to understand the insurer's propositions. They are different and and by doing that, you can really understand what's important to you in the market, but also make sure that you approach the insurers that you're most attracted to with real energy. Over to you, Sir. Lovely. And my one really comes down to put your best foot forward. I think as a small scheme you might have to work that a little bit harder and so on. With this, I mean get your preparation right, demonstrate a compelling business case and use a streamlined approach. What we've seen generally is that the difference of competitive, engaged and optimized pricing will mean you'll make the fees and time you spent back tenfold. OK, well, look everyone, thank. Thanks all for listening. If you do have any more questions or we haven't answered your questions, we'll we'll look to come back to you separately. 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