The recent record-breaking $1.8 billion group annuity purchase by General Motors Company of Canada has caught the attention of the pension industry. Plan sponsors of all sizes are re-examining the benefits of purchasing annuities, which include reducing pension risk and enhancing plan member benefit security.
While every annuity purchase is unique, there are some common considerations to work through for larger transactions. Many aspects of these considerations also apply to smaller transactions.
Brent Simmons published an article in Canadian Investment Review that looks at how jumbo transactions work.