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CSS Pension Plan transfers longevity risk to The Co-operators

By The IJ Staff | January 28 2020 03:00PM

Photo: Freepik

The Co-operators, the Co-operative Superannuation Society (CSS) Pension Plan and Aon plc announced Jan. 28 a new longevity insurance agreement aimed at achieving greater financial security for more than 6,300 CSS pensioners.

The CSS Pension Plan is a defined contribution plan that provides optional guaranteed lifetime retirement income. Under the agreement, the CSS Pension Plan will transfer longevity risk for $660 million of pension plan liabilities to The Co-operators. In exchange for quarterly premium payments, The Co-operators will pay the pension benefits amounts to the plan on a quarterly basis and the CSS Plan will maintain full responsibility for monthly pension payments to pensioners.

Aon plc advised CSS throughout all aspects of this transaction.

“CSS is very proud to have been providing an in-plan annuity option to our members for close to 50 years," said Martin McInnis, Executive Director of CSS. “Our agreement with Co-operators is a proactive and innovative approach that prudently protects our plan’s annuity offering against longevity risk and positions CSS to continue to meet the retirement income needs of our members well into the future.”

The companies say that one of the “unique features of the contract for a group of this size is the fact that it is expected to operate on a non-collateralized basis.”

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