LCP forecasts buy-in volumes could reach a record £55bn in 2026 with the possibility of further insurer acquisitions

In their annual look-ahead for the pension risk transfer (PRT) market, LCP predicts that buy-in volumes will be between £40 billion to £55 billion in 2026, with further merger and acquisition activity amongst the bulk annuity insurers possible over the next few years.

LCP believes record volumes of £55 billion could be achievable in 2026 given the strong pipeline of transactions reported by insurers. The current record volume is £49.1 billion in 2023. To reach the top end of our estimate, we would also need to see a continuation of the highly attractive insurer pricing that is currently available and was experienced over last year.

LCP expects 2025 volumes to exceed £40bn when reported with insurers’ full year results in March.

Continued M&A activity in the market

Mergers and acquisitions have been a key feature of 2025, with three of the eleven insurers active in the bulk annuity market announcing acquisitions by international insurers. Pension Insurance Corporation (PIC) was acquired by Athora, and Just Group by Brookfield – both in July – followed, shortly before Christmas, by the acquisition of Utmost’s life and pensions arm by US-based JAB Insurance, whose parent group owns consumer brands including Pret A Manger and Krispy Kreme. All three acquisitions are set to complete in the first half of 2026.

With the UK bulk annuity market set to remain highly active, LCP anticipates continued interest from overseas investors in further acquisitions, driven by the scale, maturity and significant asset inflows into the UK bulk annuity market.

Members to be centre stage in 2026

LCP expects that member service will be a key focus in 2026 as insurers continue to invest in administration platforms and digital capability. LCP predicts that:

• By the end of 2026, we expect all of the active insurers to be able to offer members online benefit modellers, giving the members they are administering increased flexibility to assess their different retirement options, and over half the insurers will offer online self-service retirement. Expanding digital offerings is a key focus for insurers, with the majority of insurers not offering online functionality two years ago.
• Over 2026 more than 150,000 pension scheme members will be moved to buy-out and receive individual annuity policies. This represents a threefold increase on the c50,000 policies issued in 2024, reflecting an increase in schemes completing their preparatory work ahead of buy-out and insurers committing significant resource to enable more schemes to complete the transition to buy-out and wind-up.

Looking further ahead

Beyond 2026, LCP expects several structural trends to shape the remainder of the decade:

• Continued diversification in alternative endgame options beyond traditional insurance buy-out. DB superfunds will become an established option, alongside other run-on strategies such as the model demonstrated by the Stagecoach/ Aberdeen transaction, where LCP advised Stagecoach. LCP expects further new DB superfunds to announce their entry this year joining Clara and TPT.
• Technology to be a defining feature of the marketplace, enabling insurers to produce quotations more quickly and at lower cost, helping to cater for the fast growing number of smaller transactions. AI-driven automation is expected to make residual risks cover accessible to a wider range of schemes, as insurers use technology to streamline and standardise due diligence processes. The highly competitive marketplace will push insurers to use technological innovation across pricing, asset sourcing and member administration.

Charlie Finch, partner at LCP, commented:

“The UK buy-in market continues to demonstrate remarkable depth and strength alongside an expanding range of wider endgame options. Our forecast of £40–55 billion of buy-ins in 2026 reflects robust funding levels and a substantial pipeline of deals, supported by highly competitive insurer pricing. The strategic acquisitions of insurers last year should give schemes confidence in the depth of long-term investor backing for the market, reinforcing competition and driving continued innovation over the rest of the decade.”

Imogen Cothay, partner at LCP, added:

“The market is increasingly evolving to meet the needs of pension schemes and their members. Insurers are investing heavily in technology, with administration and member experience being a strategic priority. This will benefit schemes of all sizes, with more efficient journeys to buy-out, and a boost in online functionality for members as digital engagement becomes the norm.”