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The Actuary The magazine of the Institute & Faculty of Actuaries

CMI working paper analyses pensioner mortality

The Continuous Mortality Investigation (CMI) has published Working Paper 44: ‘An analysis of the CMI SAPS mortality experience for the period 2001 to 2008 based on data collected by 30 June 2009’. This paper is available at www.actuaries.org.uk/knowledge/cmi/cmi_wp/wp44

The CMI’s Self-Administered Pension Scheme (SAPS) mortality investigation collects data from scheme actuaries for schemes with at least 500 pensioners. Typically, triennial data is submitted for schemes, reflecting the frequency of pension scheme valuations.

CMI Working Paper 44 presents an analysis of the SAPS dataset during the eight-year period from 2001 to 2008. The experience of this dataset has been compared against the S1 mortality tables, which were based on data relating to 2000 to 2006. Since the S1 tables were produced a substantial volume of data has been submitted, with the total lives exposed to risk increasing by some 40% for males and 50% for females.

The working paper shows that, overall, the experience of the recent dataset is consistent with the dataset underlying the S1 tables. It also appears to show that mortality rates continue to improve, particularly for males, although care should be taken in interpreting the results by year due to low volumes of data in recent years, and the heterogeneity by scheme, that arise from the triennial nature of the data.

Some key observations from analyses of various subsets of the data are that the amounts experience of female pensioners appears to be slightly heavier than expected and that the patterns of mortality experience for pension scheme members with different pension amounts are similar to those seen in the dataset underlying the S1 tables. Due to its lower data volumes, however, the female pensioner dataset gives rise to more volatile outcomes when analysed by pension amount band.

In addition to the working paper, the Committee has also produced a separate four-page executive summary, which gives a high-level overview of the working paper. To keep up to date with all the CMI’s work, visit www.actuaries.org.uk/cmi-wp/wp44