Britain's annuity providers have now ploughed £22.8 billion into UK infrastructure, housing and business projects since 2024, according to fresh figures from the Association of British Insurers (ABI) — putting the industry a little over a fifth of the way towards the £100 billion, ten-year commitment it made to the government back in 2023.
Of that total, £11.5 billion was invested in 2025 alone, spread across water networks, purpose-built student flats, temporary housing for homeless families, further education campuses and office refinancing deals from Cardiff to Canary Wharf. It's the kind of unglamorous, decades-long lending that rarely makes headlines, yet it's quietly turning life insurers into one of the country's biggest sources of patient capital.
The commitment dates back to the overhaul of the old Solvency II regime, rebadged Solvency UK once the reforms landed in 2024. Regulators trimmed the so-called risk margin and loosened the rules on what counts as an eligible "highly predictable" cash flow inside insurers' Matching Adjustment portfolios, which is the mechanism that lets annuity writers match long-dated liabilities against long-dated assets. In exchange for that flexibility, ten major providers agreed to report their UK investment activity to the ABI so progress against the £100 billion target could be tracked in public: Aviva, Canada Life UK, Just Group, L&G, M&G, PIC, Rothesay, Royal London, Scottish Widows and Standard Life.
That group collectively wrote £38.3 billion of defined benefit pension buy-in and buyout business last year, plus £7.4 billion of individual annuities, on top of holding £317 billion of assets in 2024, nearly two-thirds of which sat in the UK.
It's not a coincidence that this cohort keeps turning up as lenders to housing associations, water companies and colleges rather than more conventional borrowers: their liabilities to pensioners stretch out for decades, so they need assets that pay steady, predictable income over an equally long horizon. Big, unglamorous infrastructure debt fits that profile far better than most listed equities ever could, and that capacity has been growing for reasons that have nothing to do with the pledge itself.
Persistently higher interest rates have made annuities a more attractive retirement product, while a wave of employers de-risking their pension schemes has pushed more defined benefit liabilities onto insurers' books, swelling the pool of capital available for long-term lending.
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Real estate has swallowed the largest share of the two-year total, at £9 billion, much of it channelled into affordable and social housing plus student accommodation. Utilities, spanning energy and water, took £5.3 billion, while transport, storage and construction (think ports, buses and rail) accounted for £1.8 billion. In terms of how the money actually moves, listed and private corporate bonds made up £12.3 billion of the total, with mortgages and loans contributing a further £6.3 billion; notably, bonds' share of the mix fell from 63% in 2024 to 46% in 2025, which the ABI puts down to tighter credit spreads squeezing that market's appeal.
The £22.8bn at a glance (2024–2025)
A handful of individual deals give a flavour of what "productive investment" looks like in practice. PIC, Aviva, Rothesay, Scottish Widows, Just Group, L&G, M&G and Canada Life UK jointly financed the Haweswater Aqueduct Resilience Programme, a roughly £3 billion scheme to replace six ageing tunnel sections along a 110km aqueduct supplying drinking water to about 2.5 million people across Cumbria, Lancashire and Greater Manchester. It's the first UK water project delivered under the newer Direct Procurement for Customers model, and is expected to support around 1,200 jobs at the peak of construction.
Standard Life, meanwhile, put up £235 million of inflation-linked funding, arranged via Macquarie Asset Management, to help Westminster City Council buy more than 350 temporary accommodation properties for homeless residents, a 42-year deal with a two-year rent-free start and a requirement that the homes hit at least an EPC "C" rating. Rothesay wrote a £400 million, eight-year facility refinancing part of the Unite Group's student accommodation portfolio, covering 23 buildings across 15 cities, while Aviva backed two new Cardiff & Vale College campuses designed to teach roughly 3,000 students a year in green skills and advanced manufacturing.
The bulk purchase annuity (BPA) market that generates much of this investable capital has been through a rockier stretch than the headline pledge figures suggest. Fitch Ratings has estimated that pension risk transfer volumes fell to somewhere around £38–40 billion in 2025, down from roughly £48–49 billion the year before, even as deal counts rose past 350 on a shift towards smaller schemes.
Fitch expects margins to stay squeezed into 2026 as newer entrants compete for business against established players. The sector has also seen a burst of consolidation over the same period, with private capital buying up established annuity writers and reshaping how deals get priced and funded.
The Prudential Regulation Authority has also flagged this segment for closer supervisory attention, warning that intense competition for pension scheme business could be eroding pricing discipline just as insurers lean further into private, less liquid assets to fund it. None of that necessarily derails the £100 billion pledge, but it does underline that the capital behind these numbers isn't static, and its supply depends on a pensions and M&A landscape that's moving fast.
The ABI's own report discusses the other big variable: policy stability. Because these are decade-plus commitments, insurers say they need confidence that the rules of the game, pension transfer regulation, planning consents, procurement models which won't shift under them mid-project. Economic Secretary to the Treasury Lucy Rigby welcomed the update, saying the investments are "driving economic growth and positive change" in communities across the country, while ABI director general Hannah Gurga argued the sector has shown it can deliver "long-term investment" at scale, provided the policy backdrop stays predictable.
Two years in, insurers are broadly keeping pace with what they promised, a fifth of a £100 billion target delivered on schedule is a reasonable scorecard by anyone's measure. What's less certain is whether the underlying engine, a bulk annuity market now working through slower volumes, tighter margins and a string of ownership changes, will keep generating capital at the same rate for the next eight years.
Solvency UK is also entering its own post-implementation review, giving regulators a formal opportunity to revisit whether the reforms are working as intended before the pledge reaches its halfway point. Between that review, a reshaped BPA market and the ABI's next annual update, there's plenty still to watch, arguably more interesting in the end, than the headline number itself.
