Exchange helps pension sponsors shop annuity insurers

Mercer L.L.C., the consulting arm of Marsh & McLennan Cos. Inc., has launched the Mercer Pension Risk Exchange to help companies move their pension liabilities to an annuity insurer.

The platform allows pension plan sponsors to execute group annuity buyouts more quickly with competitive pricing, Mercer said Tuesday in a statement.

All defined benefit plan sponsors considering a retiree buyout or plan termination could use the exchange, a Mercer spokeswoman said.

The exchange, which can be accessed only by Mercer customers, allows pension plan sponsors to examine insurers that provide group annuities, according to the statement.

Mercer declined to disclose participating insurers.

“Though sponsors’ appetite to transfer pension risk is high, they face some barriers to execution. Lack of clear information about the true cost of a buyout, limited transparency and the fluctuation of market rates and plan dynamics are all major challenges,” Phil de Cristo, president and group executive of Mercer’s investment business, said in the statement.

Such arrangements allow pension plan sponsors to transfer risks associated with pension plans to annuity providers.