Aon Hewitt Brings Outsourcing to Pension-Risk Transfer

Aon Hewitt has launched an implemented annuities business, which will combine its fiduciary management services with full or partial pension de-risking.

The global investment consultant’s move follows the announcement by insurer Legal & General this month that it had launched a similar service to transition clients from its investment arm’s funds to a buyout.

“For many pension schemes, the ultimate objective is the use of a bulk annuity to secure benefits with an insurer,” said Martin Bird, senior partner and head of risk settlement at Aon Hewitt. “For many too, fiduciary investment management through delegated consulting services is the right solution for optimizing their risk/return balance in an efficient governance structure.”

Aon Hewitt noted various selling points of the new set-up, including custom annuity price tracking for each scheme, and access to insurers such as Aviva, Legal & General, PIC, and Rothesay Life, with Prudential in formal discussions to join.

Want the latest institutional investment industry news and insights? Sign up for CIO newsletters. 

The UK buyout market, which took off prior to the financial crisis, has continued to expand in the last few years. Already buyout transaction volumes have surpassed last year’s record £7.5 billion ($12 billion), according to figures from LCP.

This new product is to focus on the UK market, a spokesperson for the firm said, but Aon Hewitt will continue to work with its international buyout clients more broadly.

In the US, the company advised on the largest pension-risk transfers to date: GM and Verizon.

For an in depth look at OCIO and its impact on de-risking, sign up to receive CIO’s annual LDI/De-risking edition, released next month.

State Street Global Advisors (SSgA) has appointed asset management industry veteran Lori Heinel as its first-ever chief portfolio strategist, the firm announced today.

She will serve as the head liaison between the group’s investment strategies and clients, prospective clients, and consultants. According to SSgA, the new role puts her in charge of a roughly 20-person team.

Heinel joins SSgA from OppenheimerFunds, where for nearly four and a half years she has led its investment products division. Her extensive career in asset management also included five years as head of Citi Private Bank’s investment solutions business and eight years in a similar role at SEI.

“Lori brings a strong blend of client and investment knowledge to the position and her varied experience has given her a keen understanding of the intricacies and distinct needs of a wide range of clients,” said SSgA CIO Rick Lacaille. He complimented Heinel on her “breadth of knowledge,” and noted it would help SSgA in its aims as an outcome-oriented provider.

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news. 

On SSgA, Heinel remarked it “has built a well-earned reputation for investment prowess and exceptional client service” and said she is “thrilled to be at the nexus of both.”

Heinel began her 30-plus year career in finance as an investment banking analyst and trader for Credit Suisse First Boston.

She holds an undergraduate degree from Princeton and an MBA in finance from Carnegie Mellon University.

Related Content: Year-End Job Moves Pile Up at Asset Managers