Risk management

Our risk management approach is designed to support our business ambitions and has the following core objectives:

  • To set out the risks that we are able and willing to accept that can give us sustainable returns, and to set out risks we believe are not adequately rewarded and require close management and mitigation
  • To optimise the capital that we hold so that we can deliver our strategy
  • To provide a framework within which authority for taking risks can be appropriately delegated and controlled throughout the organisation, enabling the Board to draw assurance that the risks to which we are exposed are being appropriately identified, managed and where necessary minimised
  • To ensure we remain forward thinking in assessing what could happen to the business and what actions could be taken now and/or in the circumstances to manage or mitigate the risks

Our risk profile differs from typical defined benefit pension funds such that PIC has:

  • Minimal equity risk – through no direct holdings
  • Minimal interest and inflation rate risk – reduced through assets and hedging overlays
  • Mitigated insurance/longevity risk – reduced through reinsurance
  • Effective risk management is integral to our success and is embedded through the organisation. Where we can hedge risk effectively and efficiently, we do so, for example interest rates and inflation, which are fully hedged

To find out more about our portfolio and how we manage our assets, click here