A record number of defined benefit (DB) pension schemes converting buy-ins to buyouts has failed to ease mounting delays, as insurers face a growing backlog, according to new research from Barnett Waddingham.
The consultancy’s 2026 survey of all 11 active bulk annuity insurers found that nearly 160 schemes completed the transition to buyout in 2025, marking a 30% increase on the previous year. Insurers expect this figure to almost double in 2026, with around 300 schemes projected to reach buyout.
However, demand continues to outpace capacity. With buy-in activity forecast to exceed 400 transactions in 2026, the pipeline of schemes yet to be completed is expected to rise to more than 800, further lengthening waiting times.
The report highlights persistent delays in moving from buy-in to buyout. Of schemes that completed buy-ins in 2021, just over half have reached buyout, leaving nearly half still in transition four years later. Around half of 2022 transactions have been completed within three years, a timeframe increasingly seen as the industry benchmark and reflected in modelling by The Pensions Regulator.
More recent transactions show slower progress. Only 28% of schemes that completed buy-ins in 2023 have transitioned to buyout so far, dropping to 9% for 2024 deals.
Despite these delays, the findings suggest that faster timelines are achievable. Nearly one-fifth of schemes transacting in 2023 and 2024 have already reached buyout within one to two years, particularly where data quality and benefit preparation were addressed early.
Barnett Waddingham noted similar trends within its own portfolio, where a quarter of schemes in the 2023–2024 cohort have completed buyout. For earlier transactions, all schemes advised by the firm that transacted in 2021 have now reached buyout, compared with 54% across the wider market.
Beth Allison, head of post-transaction and wind-up at Barnett Waddingham, said the results highlight a widening gap between well-prepared schemes and those facing operational hurdles.
“Our survey highlights that while well-prepared schemes can reach buyout in under two years, it is becoming increasingly common for schemes to take three to four years from buy-in to buy-out,” she said.
Allison added that while insurer capacity is expanding and more schemes are addressing data challenges such as guaranteed minimum pension equalisation, these improvements will take time to ease pressures.
“Although insurer capacity continues to expand and more schemes are addressing major data challenges such as GMP equalisation before transacting, these changes will take time to feed through the pipeline,” she said, noting that a growing number of smaller schemes entering the market may further strain resources.
She added that preparation remains critical, with schemes that maintain strong data, clear benefit structures, and disciplined project management more likely to secure faster outcomes in an increasingly competitive market.
