Lucida PLC

At Lucida we pride ourselves on our ability to design the optimum solution for a business' individual requirement. To achieve this, we will look to engage in open dialogue with a potential client at the earliest point possible.

Solutions

• Full buyout

  All the risks are transferred to Lucida in exchange for a single premium. Ultimately the scheme is wound up and all the benefits are converted into individual annuities. This is the most complete shift of risk for the employer and trustees, and offers scheme members the security of individual benefits being guaranteed by a regulated insurance company.

• Partial buyout

  Buyout of a subset of the scheme using age, status, nature of benefits (level, escalating etc) or other criteria to divide the scheme into parts. The full risk inherent in one or more of these groups of members is transferred to Lucida via a buyout. A useful and flexible approach that allows greater targeting of the risk issues faced by employers and trustees.

• Buy-in

  Sometimes known as an insured solution, this involves Lucida insuring the risks that the trustees and sponsoring employer do not want to retain. The insurance policy becomes a new asset class within the pension scheme, overseen by the trustees alongside the existing scheme assets. This approach offers a complete solution to the risks targeted, without the need for any wider or more fundamental changes to rest of the scheme.

• Longevity only insurance

  Under this option, the scheme pays Lucida a series of payments in return for which Lucida pays the actual claims. This product allows the scheme to retain investment exposure whilst protecting against longevity risk.

Additional options

• Phased payment

  A full buyout or buy-in with the premiums spread over a period to help the scheme or sponsoring employer's cash flow situation. There are a variety of ways that these arrangements can be structured.

• Shared benefit solutions

  Sometimes called structured solutions, these arrangements allow the sponsoring employers to share the benefits of any positive mortality experience or other liability management initiatives after a buyout has happened. This is an interesting option for businesses not wishing to forfeit the potential upside of certain risks.

• Rapid transfer solution

  An immediate removal of risk via a scheme-to-scheme transfer, or by replacing the principal employer with Lucida. This is the fastest way for the employer to transfer risk, but still leaves the scheme itself in operation while Lucida winds it up.

• Insurance of operational risks

  Linked to buy-in or buyout solutions, this involves other risks being taken on by Lucida, eg - data risk, or wind-up risk.