We recently witnessed the end of a very important moment, when US, UK and Canadian pension funds were simultaneously at the best funded status they had experienced in ten years. At the same time, all three markets had new entrants in pension insurance and reinsurance with ample insurer capacity, vibrant price competition and attractive buy-in and buy-out pricing. Additionally, seven years of lower than expected longevity improvements meant the lowest liability pricing from insurers and reinsurers in over ten years.
In this very favorable market environment in 2018 and the first half of 2019, we saw more transactions in the United States, United Kingdom and Canada than ever before. Only once before have we seen market conditions this favorable— in the run up to the financial crisis—and of course that market did not last. Markets in which all factors are positive are anomalies, and once again, favorable market conditions like these have proven to be fleeting.
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