03/03/2015 02:08 EST | Updated 05/03/2015 05:59 EDT

Sun Life Financial and BCE partner up in employee pension agreement

TORONTO - Sun Life Financial (TSX:SLF) has signed a deal with BCE Inc. (TSX:BCE) to help offset the risk to the telecommunication company's pension plan if retirees live longer than expected.

Under the deal, the Bell Canada Pension Plan will pay monthly premiums to Sun Life and the insurer will make monthly pension payments into the plan for the lifetime of existing pensioners.

The longevity insurance agreement transfers risk for some $5 billion in BCE's pension plan liability to Sun Life.

Sun Life said it will reinsure a portion of the risk to RGA Canada and SCOR Global Life.

The Bell pension plan will continue to be administered by BCE.