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Old 10-24-2018, 03:23 PM
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Mary Pat Campbell
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Default Pension mortality updates

I didn't want to hide these in my other-pension-watch threads. [older versions of these have been, but I think the purely actuarial stuff should be in their own threads]

http://www.pionline.com/article/2018...on-obligations

Quote:
SOA: New mortality scale could lead to lower pension obligations

Spoiler:
The mortality improvement scale is expected to be lower in 2018, which could also mean lower pension plan obligations, according to a projection released Tuesday by the Society of Actuaries.

Compared to the previous mortality improvement scale, MP-2017, preliminary estimates for the MP-2018 improvement scale could reduce a plan's pension obligations by 0.2% to 0.4% for women and 0.3% to 0.6% for men, calculated with a 4% discount rate.

The slight decline in life expectancy is linked to higher mortality rates for three of the leading 10 causes of death in the U.S., as reported by the Centers for Disease Control and Prevention: unintentional injuries, which increased 9.7%; Alzheimer's disease, which increased 3.1%; and suicide, which increased 1.5%.

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SOA: New mortality scale could lead to lower pension obligations
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The new life expectancy under MP-2018 is 85.6 years for a 65-year-old male pension plan participant, the same as the 2017 scale; and 87.6 years for a 65-year-old female participant, also the same as the 2017 scale.

The SOA updates its mortality improvement scale annually. The MP-2018 update includes Social Security Administration mortality rates for 2014 and 2015, and preliminary 2016 mortality rates developed by the SOA based on data obtained from the SSA, CDC, Centers for Medicare & Medicaid Services, and the U.S. Census Bureau.

U.S. mortality improvement rates started to dip in 2010, and continued through 2018, said R. Dale Hall, SOA managing director of research, but SOA officials are also continuing to see varied mortality improvement across age groups. Mr. Hall said in a statement that it is "imperative" that industry professionals perform their own calculations with their own pension plan demographics to see how MP-2018 impacts their plans.


https://www.plansponsor.com/soa-mort...n-obligations/

Quote:
SOA Mortality Scale Update Could Decrease Pension Plan Obligations
When compared with 2017 projections, life expectancy for 65-year-old private pension participants decreased slightly less than one month for women, and faintly more than a month for men.


Spoiler:
The Society of Actuaries (SOA) has updated its annual mortality improvement scale for pension plans through the publication of “MP-2018,” finding a decline in future rates of mortality improvement and lower pension plan obligations compared with its 2017 scale.

The SOA’s projections suggest that adding the MP-2018 improvement scale could sink pension obligations by 0.2% to 0.4% for women, and 0.3% to 0.6% for men, when gauged with a 4% discount rate.

Additionally, the recent scale shows a slim drop in life expectancy due to raised mortality rates for three out of the 10 leading causes of death in the U.S., which according to the Centers for Disease Control and Prevention (CDC) are unintentional injuries (with a 9.7% increase in mortality rates); Alzheimer’s disease (3.1% increase); and suicide (1.5% increase).

When compared with MP-2017, life expectancy for 65-year-old private pension participants decreased slightly less than one month for women, and faintly more than a month for men. According to the new report, life expectancy for men is now at 85.6 total, and 87.61 for women.

“In MP-2018, we see continued reduction of overall U.S. mortality improvement trends that we started seeing in 2010,” said Dale Hall, managing director of research for the SOA. “However, because we are also continuing to see varied mortality improvement across the age groups, it’s imperative for industry professionals to perform their own calculations, using the demographics of their pension population to determine the impact of implementing MP-2018 on their individual plan.”

For more information, read the full Mortality Improvement Scale MP-2018 report here.


https://www.soa.org/resources/experi...scale-mp-2018/
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Last edited by campbell; 10-24-2018 at 03:34 PM..
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