While the Canadian pension de-risking market decreased in 2025, many plan sponsors that opted to not shed liabilities last year have simply delayed these plans amid evolving economic conditions, says Mathieu Tessier, vice-president of client relationships and innovation for defined benefit solutions at Sun Life Financial Inc.
“The geopolitical and economic situation of the last year got quite a few plan sponsors to put some discretionary projects on hold, particularly those in an industry that could be affected by tariffs.”
Last year’s de-risking transaction volume reached nearly $6.9 billion, compared to more than $11 billion in 2024. Tessier notes the absence of “jumbo transactions” — those valued at more than $800 million — as one of the main reasons behind the decreased volume. He notes the majority of plan sponsors de-risking in 2025 were those with plans valued at less than $100 million.
“Large plan sponsors in certain industries [were focusing] on other concerns, so 2025 was not the right year. But now we’re already hearing about a lot of de-risking discussions and quite a few transactions that were planned for 2025 were simply delayed to the future — it was more, ‘Let’s do it later’ than, ‘Let’s not do it at all.’”
For DB plan sponsors finding themselves in a surplus position, he notes it may be a good time to accelerate the de-risking discussion.
“There’s a good intersection of different market forces creating a nice opportunity for plan sponsors to just take a moment figure out how to protect these gains. . . . More and more plans are in a surplus position [and] are looking at their risk management in a different light.”
Read: Canadian pension risk transfer market declines 40% in 2025