The future of the Fund
On 5 August 2025, the Trustee signed a £4.3 billion deal with Pension Insurance Corporation (PIC) to secure the pension benefits of all members of the Fund. This type of transaction is called a buy-in.
You’ll have received a letter from us about this and it’s also available to read in your member account at www.rolls-roycepensions.com.
Why we’ve taken this decision
As a well-funded pension scheme, the Trustee has taken the opportunity to purchase an insurance policy, covering all current and future payments that the Fund is required to make to members.
The policy is held as an asset of the Fund and reduces the risks associated with movements in investment markets or geo-political factors. Without this insurance, there was a remaining risk that the Trustee might need to seek further contributions from Rolls-Royce plc over the decades to come in order to meet future benefit payments.
It’s really important that you know that the decision we’ve taken has no impact on your pension entitlement and, if you’ve not retired yet, that the same retirement options you have today will remain in place.
The Trustee Board is required to always act in the best interests of scheme beneficiaries. It is satisfied that this deal works in the best interests of all members, securing your hard-earned pension benefits in full.
Next steps…
The buy-in moves the Fund into the insurance landscape, which means we’ll amend some of our practices to align with how insurance companies work. We’ve written to all deferred members with more information about how this works but if you’re a pensioner member, there are no changes.
What happens if the Trustee decides to move to a full buy-out with PIC?
The buy-in is the first step in the journey, as the Trustee Board is likely to move to a full buy-out during the next 12 months.
Over the coming months, we’ll be working towards converting the buy-in contract to a buy-out. If we proceed, your membership in the Fund will be converted into an individual annuity policy in your own name with PIC. This will fully match the benefits that you are entitled to from the Fund.
All that changes for you at that point is that PIC will be responsible for both administering and paying your promised pension benefit.
If this takes place, the Fund would subsequently be wound-up and would cease to exist. And if there is any money left over at this point, the Trustee will write to you to let you know.
Introducing Pension Insurance Corporation (PIC)
We know you have questions about why the Trustee has chosen PIC to insure your pension.
PIC exists to take risk out of defined benefit pension schemes like the Fund by insuring them. You may not have heard of them before as they don’t sell pension products directly to people, but they already insure the benefits of 400,000 members from over 270 UK pension schemes.
The Fund is just one of many pension schemes who have taken this route to secure member benefits, joining the schemes of companies you’ll have heard of, like Boots, Siemens and Cadbury. And there will be many more who are currently on their journey to the destination we’ve arrived at.
Your pension is in safe hands, as PIC is an established company that’s strictly regulated by both the Prudential Regulatory Authority (PRA) and the Financial Conduct Authority (FCA). This requires them to act safely, in ways that reduce the chance of them getting into financial difficulty.
Most of PIC’s money is held in secure, low-risk investments. So whatever happens – inflation, stock market crashes or even a pandemic, your pension promise will always be covered. Month in, month out, year in, year out.
