Individual Life Insurance Mortality Improvement Scale – for Use with AG38/VM20 - 2023
September 2023
Revision – October 31, 2023
The 2023 FMI scale values have been revised from what was published on September 26, 2023 to correct for an error found in the interpolation between the 2023 HMI Scale and the long-term mortality improvement rate (MI LTR) at ages 0-20 and at ages 62-119. These are ages where the calculation of the HMI with the full COVID impact did not result in an initial deterioration level at 2023. So at these ages, values should have been graded from the 2024 FMI level (with lower mortality improvement than the 2023 HMI, but not deterioration) to the long-term MI rate (rather than grading from 0 at year 2026 to the long-term rate).
In the accompanying spreadsheet with revised values as of October 31, 2023, the values that have changed compared to September 26, 2023 are highlighted in orange. All values that changed have had increases in loaded FMI rates up to a maximum increase of 0.0042. Both the September 26th and October 31st Excel files with HMI and FMI rates are published here because companies can opt to use the September 26th rates if they choose since the corrected October 31st rates were published after September 30th.
Authors
American Academy of Actuaries’ Life Work Group and the Society of Actuaries’ Mortality and Longevity Oversight Advisory Council
Description
The Mortality Improvement subgroup of the American Academy of Actuaries’ Work Group and the Society of Actuaries’ Mortality and Longevity Oversight Advisory Council released a recommendation for a set of improvement factors that vary by gender and attained age to be used in conjunction with the 2008 Valuation Basic table or the 2015 Valuation Basic table for AG-38 purposes. This recommendation has been adopted by the NAIC’s Life Actuarial Task Force.
Under ‘Materials’, find the report that describes the mortality improvement scale and its intended use and the spreadsheet that contains the final version of the mortality improvement rates for year-end 2023.
Applicability of Improvement Scale
These improvement scales represent a view of reasonable historical and future mortality improvement factors for to be used in conjunction with AG 38 and VM20 for year-end 2023 valuation. These improvement scales are not intended to be employed as a standard for any other purpose. For US statutory reserves under VM20 or AG38 using the 2008 Valuation Basic Table (2008 VBT) or the 2015 Valuation Basic Table (2015 VBT), the HMI and FMI scales discussed herein are applicable. For statutory reserves using the 2008 Limited Underwriting tables, the HMI and FMI mortality improvement assumptions are zero.”
Materials
Mortality improvement Scale Recommendation (revised 10/31/2023)
Mortality improvement Scale Recommendation Rates (published 09/26/2023)
Revised Mortality Improvement Scale Recommendation Rates (published 10/31/2023)
Questions Or Comments?
If you have comments or questions, please send an email to research@soa.org