(Photo: Douglas C. Pizac/AP)
Prudential Financial Inc. announced Thursday that it has sold a group annuity contract big enough to cover $923 million in defined benefit pension plan obligations.
The Newark, New Jersey-based insurer sold the annuity to the Raytheon Company, a defense contractor based in Waltham, Massachusetts.
Raytheon is using the annuity to transfer pension obligations for 13,000 U.S. retirees who worked for Raytheon units that Raytheon classifies as discontinued operations, and for those retirees' beneficiaries.
(Related: 5 Benefits Trends on Prudential's Radar Now)
Prudential has been one of the most active players in the pension risk transfer market.
The new deal could account for about 5% of total 2018 pension risk transfer deal flow.
Wayne Daniel, head of U.S. pensions at another major market player, MetLife Inc., estimated in June, at a conference organized by S&P Global, that employers might transfer a total of about $20 billion in pension risk to insurers this year.
MetLife announced a $6 billion pension risk transfer deal with FedEx in May, and Prudential announced a $1.2 billion deal with Pension Insurance Corp. PLC, a company in the United Kingdom, that month.
