WTW Targets Mid-Size Pension Schemes With Streamlined Longevity Swap

WTW has launched a longevity swap product called Longevity Stream, aiming to make the hedging of mortality risk more accessible for UK defined benefit pension schemes with £100 million to £1 billion in liabilities.

The offering addresses a structural gap. Longevity swaps have long been the preserve of the biggest pension funds, with smaller and medium-sized schemes held back by the upfront legal costs and ongoing administrative complexity. WTW said it designed Longevity Stream to remove those barriers. Under the product, schemes pay a fixed fee and gain access to a panel of global reinsurers, with Zurich acting as the intermediary. Legal documentation has been pre-negotiated with the law firm CMS, cutting the timeline to execution.

The market context explains the timing. Since 2009, more than £170 billion of longevity risk has been transferred to reinsurers, with WTW advising on over £100 billion of that total. The latest CMI mortality improvement projections and record low death rates recorded in 2026 have refocused attention on longevity risk, particularly for schemes that had assumed rising death rates would ease the funding burden. WTW said those developments have increased interest in locking in current pricing before life expectancy assumptions shift again.

Longevity Stream also preserves optionality. Schemes using the swap can pursue a run-on strategy – keeping assets invested rather than buying out with an insurer – while retaining the ability to switch to a bulk annuity at a later date without restructuring the hedge. That flexibility matters for trustees who want to reduce risk but avoid an irreversible buy-out in a volatile rate environment.

The product may also ease pressure in the broader pension risk transfer market. If more schemes hedge longevity risk early, it could reduce the lumpiness of demand for buy-ins and buy-outs. Insurers writing bulk annuities would face less uncertainty about mortality assumptions, potentially allowing them to offer tighter pricing.

Rhys Mellens, a senior director at WTW, described the demand as coming from schemes that wanted to access the market but were deterred by the complexity. “Longevity Stream removes those barriers, giving schemes a more efficient route to market while retaining future flexibility,” he said.

Amanda Chamming, a partner at CMS, said the product allows schemes to “further reduce their risk, strengthen scheme security and protect long-term outcomes for members.”

WTW itself holds an Alpha Score of 41 out of 100 on AlphaScala, a mixed reading. The score reflects the company’s exposure to both advisory and broking revenues, where pension risk transfer demand is a growing but cyclical contributor.

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