Superfunds are a hot topic right now in the pensions industry. A consultation on the regulation of superfunds has recently closed, and a response from the Government is expected in the near future. But what are superfunds, and why might they be of interest to an employer with a defined benefit (DB) pension scheme?

What is a “superfund”?

  • A superfund is an occupational pension scheme which will, at a cost, accept a transfer of assets and liabilities from a DB pension scheme.
  • It’s a relatively new concept – there aren’t currently any operational superfunds, although market entrants are actively seeking business.
  • The entity running the superfund will be aiming to make a profit and distribute returns to external investors.  The expectation is that this can be achieved through cost efficiencies, better access to investment opportunities and the pooling of risk.
  • They will be regulated by the Pensions Regulator (although the authorisation framework is not yet in place) and the intention is that they will be eligible for the PPF.


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