Sun Life pension deal creates mega group annuity – FINANCIAL NEWS-ecozik.com
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Sun Life pension deal creates mega group annuity

Sun Life Financial Inc. President and CEO Dean Connor. Two Canadian pension funds paid Sun Life Assurance Company of Canada a combined one-time premium of $530 million and transferred so-called investment, longevity and inflation risk to the insurance unit of Sun Life Financial.

It took about a year of discussions and negotiations; it was incredibly innovative and thought as the very first of its kind in Canada.

But if this was all over two Canadian pension funds – whose names haven’t been disclosed – paid Sun Life Assurance Company of Canada a combined one-time premium of $530 million and transferred so-called investment, longevity and inflation risk towards the insurance unit of Sun Life Financial Inc. Quite simply future funding from the promised benefits was offloaded to Sun Life.

At $530 million, Sun Life asserted the transaction creates the largest group annuity in Canadian history. In 2013, Sun Life says it completed a deal using the Canadian Wheat Board worth $150 million.

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