A new retirement reality: What it means for pension de-risking

Longer lives are re-shaping retirement

As the UK’s age profile shifts decisively upward, the story of retirement is changing. Thanks to advances in healthcare and better living standards, ONS 2022‑based projections show the 85+ population almost doubling between 2022 and 2047.1 Over the same period, the UK’s median age will rise from just under 41 to over 44.2

Dependency dynamics are changing too. The old‑age dependency ratio (people of State Pension age per 1,000 of working age) will climb from 278 in 2022 to 324 by 2040.3

These rapid and pronounced demographic shifts are already reshaping the way we think about retirement. Retirees will require income and support for longer, and expect a better quality of service from those providing their pensions.

Pensions de-risking needs to adapt to this demographic shift

As a consequence, pension schemes’ risk and liability profiles are rapidly evolving too. Insurers supporting de‑risking must reflect this by deploying a disciplined, member‑first approach designed to deliver durable outcomes over the long term.

What our data and Life100+ show

At Canada Life, we look after 3.3 million customers across the UK.4 Using organisation‑wide data and insights – together with Life100+, our flagship research into longer lives – we’ve built a deep understanding of how expectations, motivations and financial needs shift as people approach and transition into retirement.

The path to retirement is becoming longer and less linear

For deferred members, who are largely still working, our research shows that the journey into retirement is changing fundamentally. People in their late 40s, 50s, and early 60s are balancing multiple pressures: supporting older parents, helping adult children, maintaining careers, and preparing for retirement.5

How this shows up in practice: 

1. More varied retirement expectations

Individuals increasingly anticipate flexible transitions (reducing hours, moving roles or blending work and pension income), making retirement timing more fluid. A de-risking partner should support an increasing range of options for members as they make these critical decisions.

2. Greater need for reassurance

With longer lives comes greater uncertainty. Members want to feel confident that their benefits are secure, predictable, and designed to support an extended later life. Here, insurers must evidence robust solvency, operational resilience, and consistent delivery over many years. 

Total wellbeing support is becoming a top priority

For members who are retired (or ‘in-payment’), many who carry on working do so for purpose and wellbeing rather than income. Our Life100+ data shows that staying mentally and physically active outranks financial necessity (around 42% vs 25%).6

Importantly, health and care move up the agenda with age, which is why a truly member-first de-risking process safeguards retirees’ wellbeing in the round, focusing efforts beyond solely financial considerations.

What this means when choosing a de-risking partner

When selecting a pension de-risking provider, trustees should look for clear evidence that member needs, for both deferred and in-payment members, are built into the operating model from day one.

This means:

1. Execution discipline

To keep the focus on member outcomes rather than administrative processes, your de-risking partner should have a named scheme consultant, conduct early data checks at the information gathering stage, and have a structured plan for onboarding, benefit specification, and reconciliation.

2. Member first communications

Members need to be reassured and well informed, so plain English communications that explain what stays the same, what changes, and what happens next, alongside continuity of payments and clear protocols for vulnerable customers, are a must. 

3. Life‑event pathways and inclusive access

Because life events drive many member interactions, friction‑light routes to deal with bereavement journeys, supported by multi‑channel access (secure digital self‑serve, phone, and post), ensure every member and their loved ones can get help in a way that works for them. 

4. Financial strength and stewardship

To keep member promises secure for decades, look for strong financial strength ratings, disciplined long‑term capital and risk management frameworks, and recognised UK stewardship credentials. 

Our member-first approach

At the heart of Canada Life UK’s de-risking proposition is a commitment to delivering the right outcomes for members, both today and in the decades ahead. We’re tackling longevity‑era challenges head‑on and actively pursue solutions that support a more holistic approach to members’ wellbeing.

 Building on our financial strength, 120-year heritage in the UK, and our global backing by Great-West Lifeco, our de-risking business is growing in a way that’s safe and responsible. We have the right culture, people, and strategic priorities in place to deliver on our promise to put members first.

Endnotes

1. ONS, National population projections: 2022‑based, migration‑category variant (bulletin, 28 Jan 2025) and ‘Migration category variant, UK summary’

2. ONS, 2022‑based NPPs, migration‑category variant (UK summary workbook)

3. ONS, 2022‑based NPPs, migration‑category variant (UK summary workbook)

4. As at 31st June 2026

5. Life100+ Report 2: Building longevity‑ready workplaces in the UK (Canada Life UK, 2025)

6. Life100+ Report 1: Exploring longevity to build financially secure futures (Canada Life UK, 2024)