23 Feb 2010
LG advises BMW UK Pension Scheme on largest ever longevity insurance deal
International business law firm Lawrence Graham LLP ("LG") has advised the trustee of the BMW (UK) Operations Pension Scheme on a major longevity insurance transaction covering its 60,000 pensioners.
The Scheme has put in place a long-term insurance contract with Deutsche Bank's specialist unit Abbey Life to provide the Scheme with a hedge to remove longevity and other demographic risks. This deal is the largest transaction of its type to date.
The LG team was led by Head of Pensions, Robert Smith. Corporate partner Paul Walker handled the negotiations on the longevity and collateral agreements. Other specialists across LG's Banking, Insurance and Pensions teams were also involved.
Robert Smith said: "We are delighted to have worked on this high profile deal for our long-standing client, BMW (UK) Trustees Limited. We see this as a ground-breaking precedent for further transactions in the pensions industry."
Paul Walker said: "This is a landmark transaction for UK pension schemes. It provides an innovative method of risk reduction for longevity and demographic risks. The transaction raised many important legal issues and we drew on highly specialised legal skills in banking, insurance and pensions law."