You can download this article from this link.

We are living longer but expectations of just how fast the increase will be and how high have been over-estimated. Thanks to Pension Oldie who has sent me this information which I heard reported on the radio in the middle of the night (a scary report for a man in the worrying status of “on the cancer pathway”.

Here’s the remark made by Pension Oldie,

I thought you might be interested in this article from Mediscape UK (a website for healthcare professionals) reporting on the recent ONS Report on life expectancy.

The thing that stands out to me from the headline and the article is the slowdown in the mortality improvement rate over previous estimates,  particularly against the 2010 projections.  In pension terms this may be quite significant because the “over-estimate” of mortality improvement occurred at the time of very low discount rates for future liabilities.  As discount rates have risen the impact of mortality projection changes on valuations becomes a lot less significant.  While this may not have been predictable, mortality over-prudence will have compounded discount rate over-prudence in valuations throughout the 2010s and early 2020s.

We might like to have a Pension Playpen update from the actuarial mortality monitoring “CMI” team

I recall you have commented on these matters before Mortality windfalls – nasty brutish and short. | AgeWage: Making your money work as hard as you do but I think this is now a considerably reduced issue and attention should be directed elsewhere – but is it still being talked up as an issue?

Nearly two years ago I reported on ONS figures giving those who run our pension schemes (and those who set up  annuities) some solace that their liabilities would fall (a little).

But that ONS report was not followed up by anyone but the FT and Jo Cumbo and the indefatigable Stuart Macdonald and Mike Harrison.

Stuart Macdonald and the Covid 19 Actuarial Response Group have been developing this story week-by-week over the past three years. Here is the latest in a line of reports fed to us through its website and social media.

ONS deaths data has been released for week ending 17 Mar.

1,074 more deaths were recorded in-week compared to the 5-year average. That’s 10% more which is a bigger excess than recent weeks.

Year-to-date there have been 147,964 deaths recorded, 6% more than the 5-year average. pic.twitter.com/FEoXoH0H0i

— stuart mcdonald (@ActuaryByDay) March 28, 2023

As Stuart has been telling us since the first days of the pandemic, every day lost is a personal sadness and a pool of sorrow to those who love the lost one. We should not allow the idea of de-risking liabilities to obscure that observation.

I can’t be too po-faced with actuarial friends like Mike Harrison about

Every mortality cloud has a pensions industry silver lining.

💀 https://t.co/Uktih54PEy

— Mike Harrison (@HigherEdActuary) April 4, 2023

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Improvements in men’s life expectancy

But back to more comprehensive ONS figures and the Mediscape UK report.

I’m pleased to see that while we continue to have shorter life expectancy than women, men of my age are catching up (as have older generations)

This is good news for my generation but it is only to be expected if you’ve been studying longevity for decades

It is more , it seems, than the prevalence of McDonalds and other fast food outlets as reported on Radio 5s “Wake up to Money”. There is a lot for us to think about and we , as pensions people, should not be gloating that our surpluses may be even bigger than thought.

The problem, as Pension Oldie points out, is that many of our schemes are basing their liabilities on life expectancy expectations that are being downgraded. Let’s not celebrate, let’s see if we can return to a pathway to longer lives, not the one I’m currently on!

You can download this 10 year old but helpful report from this link.