TORONTO, February 21, 2024 – WTW (NASDAQ: WTW), a leading global advisory, broking, and solutions company, in collaboration with RBC Insurance, Sun Life and Desjardins Group, today announced a group annuity buy-out transaction of CA$923 million for over 2,700 members of the Ford of Canada Retirement Pension Plan Number 3 who retired on or prior to June 1, 2021.
Marco Dickner, Canadian Retirement Risk Management Leader at WTW, said, "This transaction is part of a growing trend in the private sector, where plan sponsors can protect pension benefits for plan members and eliminate risk for the companies.”
Nadine Orr, Head of Group Annuity at RBC Insurance, said “RBC Insurance is proud to be acting as the lead insurer in this important three-way partnership with Sun Life and Desjardins. This solution shows that the market continues to be able to support large transactions in a single day to meet the needs of plan sponsors, while signaling the confidence they have in our ability to ensure a seamless transition.”
Brent Simmons, Head of Defined Benefit Solutions at Sun Life, added “The Ford transaction demonstrates the ability of insurers in the Canadian annuity marketplace to collaborate on insurance solutions that provide increased benefit security and peace of mind for annuitants.”
“Desjardins is pleased with this new partnership with Ford of Canada, in collaboration with RBC Insurance and Sun Life, which will reduce certain risks related to their group retirement plan and provide a stable and solid financial future for plan members” said Marie-France Amyot, Senior Vice-President Insurance and Group Savings Division, Desjardins Group.
WTW estimates that up to 88% of Canadian private sector defined benefit pension plan liabilities remain available to be secured by annuity transactions. Plan sponsors are expected to continue to take advantage of this risk transfer opportunity as many Canadian pension plans are well-funded, and rising interest rates have improved annuity pricing.
Under an annuity buy-out, an insurance company assumes responsibility for making pension payments to plan members in exchange for a premium from the pension plan sponsor.
At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance.
Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you.
RBC Insurance® offers a wide range of life, health, home, auto, travel, wealth, annuities and reinsurance advice and solutions, as well as creditor and business insurance services to individual, business and group clients. RBC Insurance is the brand name for the insurance operating entities of Royal Bank of Canada, Canada's biggest bank and one of the largest in the world, based on market capitalization. Its brand is built on trust, strength, stability and continual success, and it has consistently been awarded strong credit ratings by A.M. Best and S&P Global. RBC Insurance is among the largest Canadian bank-owned insurance organizations, with 2,700 employees who serve 4.8 million clients globally.
RBC Insurance Group Annuity delivers retirement security to defined benefit pension plan members. With a commitment to best-in-class service, RBC Insurance provides plan sponsors with the stability of a risk management solution dedicated to their needs and backed by RBC’s purpose-driven, principles-led approach to delivering leading performance.
Sun Life is a leading international financial services organization providing asset management, wealth, insurance and health solutions to individual and institutional Clients. Sun Life has operations in a number of markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China, Australia, Singapore, Vietnam, Malaysia and Bermuda. As of December 31, 2023, Sun Life had total assets under management of $1.40 trillion. For more information, please visit sun life.
Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and Philippine (PSE) stock exchanges under the ticker symbol SLF.
Note to editors: All figures in Canadian dollars.
Desjardins Group is the largest cooperative financial group in North America and the fifth largest in the world, with assets of $414.1 billion as at September 30, 2023. It was named one of the World’s Top Companies for Women by Forbes magazine. To meet the diverse needs of its members and clients, Desjardins offers a full range of products and services to individuals and businesses through its extensive distribution network, its online platforms, and its subsidiaries across Canada. Ranked among the world's strongest banks according to The Banker magazine, Desjardins has one of the highest capital ratios and one of the highest credit ratings in the industry.
