Pension Risk Transfer Market Grows to $51.8 Billion in 2024

The pension risk transfer (PRT) market in the U.S. continues to grow, with 14 carriers reporting over $1 billion in sales during 2024. Total single-premium PRT sales reached $51.8 billion, a 14% increase from the previous year, almost matching the record set in 2022. The fourth quarter saw a dip in sales, aligning with the erratic nature of PRT transactions. LIMRA's assistant vice president noted that the market expansion is expected to continue despite potential dampening factors in 2025, as plan sponsors become more aware of these solutions. Significant transactions included IBM's $6 billion deal and Verizon's $5.9 billion deal, both involving Prudential Financial Inc.

In addition to single-premium PRT sales, buyout contracts showed a decline in Q4 but a year-over-year increase in buyout premiums. Overall, the demand for pension buyouts, which allow companies to offload pension liabilities to insurers, remains robust. LIMRA indicates that while recent market trends present challenges, the outlook for the PRT market remains positive due to heightened awareness and interest among plan sponsors.