Thomas Cook Travel Schemes benefits secured with PIC

The AT Mays Limited Pension and Life Assurance Scheme, the Inspirations Group Pension Scheme and the Sun International (UK) Limited Pension and Life Assurance Scheme, collectively referred to as the Thomas Cook Travel Schemes (the Schemes), have agreed buy-ins with Pension Insurance Corporation plc (PIC) with a total premium of c£50m.

The last deal for the Schemes completed in November 2023. The buy-ins secure the liabilities of 520 members across the Schemes to receive benefits at, or above Pension Protection Fund (PPF) compensation levels.

PIC was selected following an insurance market review and competitive selection process.

The exact outcome for each member will not be known until the buy-outs occur. This is expected to happen during 2024, as further work is required for each scheme before they can be fully transferred to PIC.

Open Trustees acts as sole trustee to the Schemes. Open Trustees is an independent entity but is wholly owned by international law firm, Osborne Clarke LLP. Open Trustees was advised by Mercer as Risk Transfer advisor and Gowling WLG LLP as legal advisor.

Jonathan Hazlett, Managing Director of Open Trustees said:

“Entering into these buy-in policies with PIC is a good outcome. The insurance market is extremely busy at the current time and it can be very challenging to secure member benefits for smaller schemes. Notwithstanding this, PIC has offered us the opportunity to ensure that the Schemes’ members receive benefits greater than what they would have received from the PPF. It has been a long process getting to this point. Many members will now receive higher benefits than they might otherwise have expected had the Schemes had entered the PPF.

Ben Stone, Lead adviser to the Open Trustees and Risk Transfer Partner at Mercer added:

It is a great achievement for the Trustees to reach this significant stage in securing benefits with PIC for members of the three Thomas Cook Travel Schemes. The buy-in policies with PIC will enable members of the schemes to receive benefits above the level of benefits they have been receiving from the PPF and we look forward to supporting the Trustees over coming months to complete that process.

Tristan Walker-Buckton, Head of Pricing at PIC, said:

Many much larger schemes are now seeking to de-risk this year, so demonstrating that PIC is interested in the whole buyout market and has the adaptability and scale to accommodate all sizes of deal is important to us. Open Trustees have now been able to completely de-risk these three Schemes, providing greater security to the members.