Longevity Analysis for Pension Schemes

Life expectancy has been increasing rapidly in recent years, so defined benefit pension schemes are investing more time considering the most appropriate assumptions to use:

to gain a better indication of the ultimate cost of running a scheme and avoid adverse financial experience emerging gradually over time
to understand the nature of the risks inherent in the mortality assumption, while mitigating as far as possible the risk that mortality tables are not representative of the scheme members
where it applies, to comply with The Pension Regulator’s guidance that trustees should consider evidence when setting mortality assumptions

Our client teams work in tandem with our specialist Longevity Consulting team to provide a concise report making best use of the data available and tailored to the specific needs of your scheme.

This report is intended to inform your understanding of the assumptions being considered for the forthcoming valuation, i.e. the choice of base table, any adjustments needed to it and an allowance for future improvements in longevity. It also provides schemes with an understanding of the level of prudence contained in the mortality assumptions, to give confidence that the assumptions are reasonable for the scheme’s members.