Aon Pension Risk Tracker – S&P 500 DB Plans Review

Aon's Better Being Podcast

Our Better Being podcast series, hosted by Aon Chief Wellbeing Officer Rachel Fellowes, explores wellbeing strategies and resilience. This season we cover human sustainability, kindness in the workplace, how to measure wellbeing, managing grief and more.

Aon Insights Series Asia

Expert Views on Today's Risk Capital and Human Capital Issues

Aon Insights Series Pacific

Expert Views on Today's Risk Capital and Human Capital Issues

Aon Insights Series UK

Expert Views on Today's Risk Capital and Human Capital Issues

Client Trends 2025

Better Decisions Across Interconnected Risk and People Issues.

Construction and Infrastructure

The construction industry is under pressure from interconnected risks and notable macroeconomic developments. Learn how your organization can benefit from construction insurance and risk management.

Cyber Resilience

Our Cyber Resilience collection gives you access to Aon’s latest insights on the evolving landscape of cyber threats and risk mitigation measures. Reach out to our experts to discuss how to make the right decisions to strengthen your organization’s cyber resilience.

Employee Wellbeing

Our Employee Wellbeing collection gives you access to the latest insights from Aon's human capital team. You can also reach out to the team at any time for assistance with your employee wellbeing needs.

Environmental, Social and Governance Insights

Explore Aon's latest environmental social and governance (ESG) insights.

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Our Global Insurance Market Insights highlight insurance market trends across pricing, capacity, underwriting, limits, deductibles and coverages.

Global Risk Management Survey

Better Decisions Across Interconnected Risk and People Issues.

Regional Results

How do the top risks on business leaders’ minds differ by region and how can these risks be mitigated? Explore the regional results to learn more.

Top 10 Global Risks

Trade, technology, weather and workforce stability are the central forces in today’s risk landscape.

Industry Insights

These industry-specific articles explore the top risks, their underlying drivers and the actions leaders are taking to build resilience.

Human Capital Analytics

Our Human Capital Analytics collection gives you access to the latest insights from Aon's human capital team. Contact us to learn how Aon’s analytics capabilities helps organizations make better workforce decisions.

Human Capital Quarterly Insights Briefs

Read our collection of human capital articles that explore in depth hot topics for HR and risk professionals, including using data and analytics to measure total rewards programs, how HR and finance can better partner and the impact AI will have on the workforce.

Insights for HR

Explore our hand-picked insights for human resources professionals.

Workforce

Our Workforce Collection provides access to the latest insights from Aon’s Human Capital team on topics ranging from health and benefits, retirement and talent practices. You can reach out to our team at any time to learn how we can help address emerging workforce challenges.

Mergers and Acquisitions

Our Mergers and Acquisitions (M&A) collection gives you access to the latest insights from Aon's thought leaders to help dealmakers make better decisions. Explore our latest insights and reach out to the team at any time for assistance with transaction challenges and opportunities.

Natural Resources and Energy Transition

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Navigating Volatility

How do businesses navigate their way through new forms of volatility and make decisions that protect and grow their organizations?

Parametric Insurance

Our Parametric Insurance Collection provides ways your organization can benefit from this simple, straightforward and fast-paying risk transfer solution. Reach out to learn how we can help you make better decisions to manage your catastrophe exposures and near-term volatility.

Pay Transparency and Equity

Our Pay Transparency and Equity collection gives you access to the latest insights from Aon's human capital team on topics ranging from pay equity to diversity, equity and inclusion. Contact us to learn how we can help your organization address these issues.

Property Risk Management

Forecasters are predicting an extremely active 2024 Atlantic hurricane season. Take measures to build resilience to mitigate risk for hurricane-prone properties.

Technology

Our Technology Collection provides access to the latest insights from Aon's thought leaders on navigating the evolving risks and opportunities of technology. Reach out to the team to learn how we can help you use technology to make better decisions for the future.

Trade

Our Trade Collection gives you access to the latest insights from Aon's thought leaders on navigating the evolving risks and opportunities for international business. Reach out to our team to understand how to make better decisions around macro trends and why they matter to businesses.

Transaction Solutions Global Claims Study

Better Decisions Across Interconnected Risk and People Issues.

Weather

With a changing climate, organizations in all sectors will need to protect their people and physical assets, reduce their carbon footprint, and invest in new solutions to thrive. Our Weather Collection provides you with critical insights to be prepared.

Workforce Resilience

Our Workforce Resilience collection gives you access to the latest insights from Aon's Human Capital team. You can reach out to the team at any time for questions about how we can assess gaps and help build a more resilience workforce.

Pension Finance Year in Review
January 2026

Pension Finance Year in Review

A recap of the impact of capital markets and corporate action on the funded position of the S&P 500 companies with defined benefit pension plans during 2025.

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Since 2011, Aon’s Pension Risk Tracker has estimated the daily funded status of S&P 500 defined benefit plans, building a robust long-term dataset that shows how markets, interest rates, and regulatory changes translate into real-world outcomes for large corporate pension plans. Institutional investment committees and plan sponsors can use these insights to compare their plan’s performance with broader market experience and to inform forward-looking decisions.

In this year’s Volume Six issue, we start with a review of the funded status activity during 2025 for the S&P 500 in aggregate, including an attribution analysis of the changes. We then highlight the key differences in the funded status activity observed across sectors. Finally, we close with insights on anticipated trends for 2026, such as liability-focused investment strategies, continued strategic de-risking through pension risk transfer (PRT) activity, and leveraging pension surplus.

Key Takeaways

  1. Funded ratios remain resilient amid market volatility
    During 2025, the aggregate funded ratio for S&P 500 defined benefit plans increased from 100.4% to 103.3%. Despite short-term fluctuations, funded levels remain at incredibly strong positions, creating opportunities to optimize long-term strategies including contribution policies, investment mix, risk-reduction actions, and unlocking the value contained in any surplus assets.
  2. Investment strategies continue to evolve toward de-risking
    As funded positions improve, many plan sponsors have increased allocations to liability‑hedging assets, expanded use of investment alternatives, and turned to OCIO providers to help navigate complex markets.
  3. PRT activity remains a core end‑state tool
    Settlement strategies, such as annuity buy-ins and buy-outs, lump‑sum windows, and plan terminations, are being used to reduce balance sheet volatility, administrative complexity, and longevity risk. Recent PRT activity—particularly strong transaction volumes in late 2025—suggests that risk transfer will remain central to end‑state planning and governance discussions for many plan sponsors.

Leveraging Aon’s proprietary data, insights, and specialized expertise, we partner with plan sponsors to assess funding, investment, and de‑risking strategies aligned to their objectives, risk tolerance, and governance framework. Connect with us today  to discuss your pension strategy and what lies ahead for your plans.

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