Turner Report: Pensions risk

Investment return risk is affected by what type of scheme is offered. A DB scheme will place the burden on the scheme provider, a DC scheme will place the risk on the individual, although the post-retirement risk is absorbed by the annuity provider, the report stresses. Longevity is a risk because nobody know exactly how long they will live in retirement. Again, however, this risk is not borne by the individual, but by the DB scheme provider, the annuity provider, or the government. One problem with the status quo, however, is that insurers are not sure how much risk they can absorb l...