The ABI have given the market an update of the progress of insurers  in the investment of their workplace pensions.

This is not quite the good news we might have been expecting. This from the Progress Update the ABI has issued.

Unlisted equity investments in DC default funds increased from £793 million to £1.6 billion.

At the same time, in-scope DC assets overall increased by 21% to £268 billion. As a result, the proportion invested in unlisted equities grew from 0.36% in 2024 to 0.6% in 2025.

According to our survey, over a third of the signatories said that in the last year they have increased private market exposure in an existing default. Unlisted equity
investment within broader DC assets also increased from £5.3 billion to £6 billion.

This is a result of a long approach

When you compare the £268bn in insured DC assets , only 0.6% is invested in unlisted securities. It would seem that insurers are being held back from investing by the “multi-step process” but more fundamentally commercial considerations are holding insurers back.

This looks to me like kicking the Compact three years down the road. Right now insurers are fighting with each other over price (and margin).

The tiny amount of money that Compact is devoting to private equity compares with the achievements of open DB plans – most obviously LGPS and to a lesser extent USS. But Nest is a DC plan. Together, Nest and IFM expect to capitalise on significant UK private market investments and unlock new investment opportunities across the globe. Nest’s ambition is to invest around £5 billion through IFM by 2030.

Nest has £50bn of assets, less than 20% of the ABI’s insurers.  More details from the ABI is provided here.

I would like to see the pace of the Compact’s adoption of private assets speed up. If it is value not price that is driving workplace pension providers, let’s see a new approach to investing and the courage to put up prices where needs be. Insurers will do better to walk away from business deals based on price rather than value. Better be transparent about value and money than hide behind cheap listed trackers.

My DC pot is invested in an insured pool fund. I am prepared to pay more for value.