In this video, Igor Nikitin introduces the concept of Pension Risk Transfer (PRT), explaining how corporations move defined benefit pension risks from their balance sheets to insurers. The session outlines U.S. pension regulations, reasons for de-risking, and the primary PRT structures such as lump-sum windows, partial retiree buy-outs, and full plan terminations. It discusses how all parties—plan sponsors, participants, and insurers—benefit from PRT transactions and why the market has seen explosive growth. The video also describes how buy-out deals are executed and highlights the important role actuaries play in managing complex technical, regulatory, and financial aspects of these transactions.
Contributors: Igor Nikitin, ASA, MAAA; Faith Wilson, FSA, CERA; Jon Forster, ASA, MAAA