Stephen Richards

Trends in cause of death can be an instructive way of looking at past mortality, although we have previously seen that we have to be very careful that an apparent "trend" is not due to changes in recording.  Leaving aside the problems of shifting classification over time, what of the categories themselves?

When projecting mortality rates it is common for people to ask what sort of changes in causes of death might be required to achieve a particular scenario.  Often one is asked to posit what causes of death have to be "eliminated", and the results can lead to the conclusion that a particular projection is unlikely and therefore too prudent.

We have written before about how survival models make better use of available data. 

Previously I wrote about how mortality rates by cause of death vary by deprivation index (and, by implication, socio-economic group). This substantially complicates any attempt to use cause-of-death data to make projections of mortality for annuity portfolios and defined-benefit pension schemes.

Last night an paper on the management of annuities was presented to the Faculty of Actuaries in Edinburgh.

Boxing Clever

In an earlier blog I wrote about how stochastic volatility in run-off increases with age. This applies when you exactly know (or think you know) the current and future mortality rates.

Insurers and reinsurers throughout the EU are facing up to the implementation of Solvency II, a radical overhaul of regulatory standards for insurance business.  Recently we explored how much Solvency II demands stochastic models. 

Solvency II is a major overhaul of the reserving rules for insurers throughout the European Union.  An important consideration for annuity writers is how it will relate to longevity trend risk.

Geodemographic profiles use addresses or postcodes to classify people into groups which are homogeneous with respect to variables like income, housing tenure and life stage.  The original purpose of geodemographic profiles was to improve targeting for marketing purposes.