In recent years, annual insurance investment into Equity Release Mortgages (ERMs) has grown almost four-fold as insurers have sought to invest more in capital efficient illiquid assets, particularly to back annuity portfolios within Matching Adjustment (MA) portfolios. 

There has been significant regulatory focus on the asset class, and this continues to be of importance to both the market and actuaries as a whole. Actuaries continue to play a growing role in many aspects of this product, and would benefit from further support from the IFoA in some key areas. These include input into, and impact assessment of, the Solvency UK regime in the UK, as well as related areas of valuation, risk modelling and risk management of these products. In addition to this, changes in retirement provisioning brought about through UK pension reform are shining a light on the role of the product, with interesting questions around both the design and the reach and potential evolution to meet both customer and wider social needs. The impact of the interest rate environment on market dynamics is also topical.

Chair: Raj Saundh

Established: 2016

Published content:

• Survey of on the use of Automated Valuation Models for properties within equity release portfolios October 2024