How offshore insurers and private equity giants are turning retirement security into a global arbitrage game
“Risk transfer” has become the pension industry’s favourite euphemism. But when £500 billion in UK retirement promises is being quietly funnelled to Bermuda-based shell structures owned by global financiers, we must ask: what’s really being transferred — and who benefits?
🚪 The Rise of the Bermuda Backdoor
In July 2025, private equity titan Apollo announced that its European arm, Athora, had acquired Pension Insurance Corporation (PIC) — securing one-fifth of the UK bulk annuity market in a single deal.
But Athora isn’t your typical British insurer. It’s registered in Bermuda, a well-known offshore tax haven and light-touch regulatory jurisdiction.
This move isn’t just corporate strategy — it’s a blueprint for systemic risk extraction, tax avoidance, and regulatory evasion. And your pension could be the next victim.
💸 What’s Really Happening?
1. Defined benefit (DB) pension schemes are being sold off by sponsoring employers.
Rather than running them to maturity, companies now “de-risk” by transferring liabilities to insurers via bulk annuity deals — a market expected to hit £500bn over the next decade.
2. Insurers like Athora buy these liabilities and invest the pension assets for profit.
But increasingly, these assets are diverted into opaque, illiquid, and high-risk investments — private credit, infrastructure loans, hedge funds.
3. The Matching Adjustment (MA) and funded reinsurance allow insurers to appear stronger on paper than they truly are.
Insurers boost their balance sheets by applying regulatory capital discounts and shipping risks off to offshore entities — often to their own subsidiaries in Bermuda.
🏝️ Why Bermuda?
Bermuda is the financial equivalent of a ghost ship:
- ✅ No corporation tax
- ✅ Minimal disclosure requirements
- ✅ Weakened solvency oversight compared to UK regulators
- ✅ Friendly to “funded reinsurance”, letting UK insurers outsource risk without real transfer of accountability
Apollo and others are capitalising on Bermuda’s leniency — creating an illusion of safety while turning pensions into leverage machines for private equity profit.
🔥 This Is QROPS — But on Steroids
This is not just another pension story — it’s a financial scandal in the making, potentially 50 times larger than the QROPS disaster that saw 40,000 Brits lose £10 billion in pension savings over a decade.
That scandal involved unregulated offshore schemes exploiting weak oversight. This time, the same structural flaws — poor governance, opaque asset strategies, weak due diligence — are being quietly embedded within mainstream UK pensions through bulk annuity deals.
And now, instead of just a few thousand offshore victims, we’re talking about millions of pensioners and £500bn in retirement assets being exposed to offshoring, leverage, and private equity risk — all under the guise of “de-risking.”
🛑 A Message to UK Regulators
Turning a blind eye to pension asset offshoring has just opened the floodgates.
The PRA, FCA, and HM Treasury must recognise that allowing Bermuda-registered insurers to handle UK retirement liabilities is more than a technical issue — it’s a systemic failure in regulatory accountability.
If you allow private equity to dress up as insurance, base their operations in tax havens, use reinsurance to shuffle risk out of sight, and rely on solvency models like the MA that disguise exposure — you are not supervising risk, you are enabling it.
Regulators must:
- 🔒 Tighten oversight of cross-border reinsurance arrangements
- 🔍 Conduct full transparency audits of offshore-linked pension insurers
- 🚫 Ban or heavily restrict the use of MA and funded reinsurance with offshore entities
- 🗳️ Put pension scheme members and trustees back at the heart of governance
🧠 Aquarian Insights: The Age of Transparency Must Begin
The Piscean era of secrecy and financial wizardry must end. Under the guise of “sophistication,” pensions are being quietly siphoned into unaccountable private hands. It’s time to expose and reverse this trend:
- 🛑 Call out the myth of “risk transfer” — it’s risk repackaging and offshore dumping.
- 💬 Demand trustees and unions scrutinise not just the deal, but the destination.
- 🗳️ Campaign for legislative reform to prohibit use of tax havens in UK pension transactions.
- 📣 Educate scheme members that “insured” doesn’t mean safe when the insurer operates offshore.
🔚 Final Word
If we let Apollo and its peers offload British pensions to Bermuda, we’re not managing risk — we’re outsourcing it to opacity.
Pensions are a social contract, not a speculative asset class.
This isn’t just about financial loss — it’s about justice, trust, and the future of retirement.
📎 Appendix: “Run-On” vs Risk Transfer – A Deeper Dive into Systemic Weakness
Recent discussions within the Pension Playpen community — particularly a thought-provoking session led by William McGrath — have exposed the deeper systemic drivers behind the explosion of DB pension risk transfers to private equity-backed insurers.
This appendix provides vital context for understanding how regulatory capture, distorted incentives, and opaque governance frameworks have enabled the very offshore practices scrutinised in this article.
🔎 Summary of Key System Failings
🧮 Actuarial Oversight is Broken
- Multiple official reports (Penrose, Morris, Kingman) highlight the lack of scrutiny over actuarial modelling in DB schemes.
- This blind spot has allowed overly conservative assumptions to justify risk transfers and fuel the illusion that “buyout is safer.”
🤝 Conflicts of Interest & Regulatory Capture
- Critical bodies like the CMI (which sets mortality assumptions) are stacked with insurer and consultant representatives.
- The same entities that set assumptions profit from the outcomes via longevity swaps and buy-ins.
- The resulting environment suppresses viable alternatives in favour of insurer profits.
🔍 Transparency & Disclosure Failures
- Mega-transactions (e.g. NatWest-Rothesay £10bn buy-in) proceed with almost zero public disclosure.
- Surpluses are absorbed into these transactions, rather than shared with members or reinvested for long-term value.
- The Financial Reporting Council (FRC) must mandate deeper thematic reviews and enforce TAS 300 V2.1 modelling standards.
🛣️ The Case for “Run-On” — A Suppressed Alternative
“Many schemes are well-funded and viable long-term. Risk transfer is not the only — or best — path.”
- Run-on models, backed by gilts +1.5–2% returns, could outperform insurance buyouts in the long run.
- This approach retains control, reduces cost, and avoids offshoring risk to unaccountable entities.
- It also supports UK economic growth through productive investment — aligning pensions with the national interest.
🧱 A Fractured & Weak Regulatory Architecture
“We have a jigsaw puzzle of regulators — but no joined-up picture of protection.”
- With TPR, FRC, FCA, IFoA, CMA, PPF, BoE all playing disconnected roles, the system lacks cohesion and coordination.
- Calls to re-establish the Joint Forum on Actuarial Regulation grow louder, as risks increasingly span multiple domains: pensions, insurance, and private capital.
🧨 Repeating the Mistakes of QROPS — At Scale
This article draws stark parallels to the QROPS pension scandal, where 40,000 Brits lost over £10 billion due to offshore schemes and regulatory blind spots. The current bulk annuity trend threatens to become a scandal 50 times larger.
UK regulators have again:
- Approved deals with unresolved liabilities
- Allowed offshore entities to assume critical pension responsibilities
- Failed to ensure transparency, member engagement, and public accountability
🧰 Solutions Emerging from the Community
The Playpen session proposed practical reforms:
- Reignite “run-on with security” as a legitimate option for well-funded schemes.
- Enforce full modelling under TAS 300 to compare buyout vs. run-on in all transfer decisions.
- Mandate disclosures for all buy-in/buyout transactions — including use of surplus and investment strategy.
- Re-empower trustees and members with a clear view of downside risk, upside opportunity, and credible alternatives.
- Use discretion already available to improve member outcomes, including re-opening accrual or linking to CDC or capital-backed models.
🐾 Final Word: The Gruffalo’s Grandparents
William McGrath closed with a powerful metaphor: “Trustees are like the Gruffalo’s grandparents – smarter and stronger than they think, but too often led into the woods by foxes in suits.”
The message: trustees don’t have to be eaten alive. With courage, transparency, and proper modelling, they can protect member interests — and avoid handing over pensions to offshore predators disguised as protectors.
To support or refer someone to Get SAFE, visit the Academy website.
Together, we can turn victims into victors and restore what was taken—one life at a time.
About Get SAFE
Get SAFE (Support After Financial Exploitation) was born from a simple truth: too many victims of financial abuse are left to suffer in silence.
We exist for people like Ian—for the ones who did everything right, only to be failed by the systems they trusted. We know that behind every vanished pension, every ignored complaint, and every stonewalled letter is a person—frightened, exhausted, and too often alone.
Get SAFE offers more than sympathy. We offer structure, support, and solidarity.
We provide a voice where there’s been silence, and clarity where there’s been confusion.
We stand beside those who have been exploited, not just to help them recover—but to help them reclaim their story and rebuild their future.
Because financial justice is not a luxury.
It’s a human right.
If you or someone you know has been affected by financial exploitation, we are here.
You are not alone.
Learn more at: Get SAFE (Support After Financial Exploitation).
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