U.S. Public Pension Plan Mortality Assumptions

June 2018

Mortality assumptions in use by public pension plans in the United States vary widely. This study compares the mortality assumptions used for funding purposes by state-based and large-city public pension plans in terms of the annuity factors they produce. Because mortality changes at older ages generally affect pension plan liabilities more than mortality changes at younger ages, this analysis focuses on post-retirement mortality assumptions.

Here is a high-level summary of key findings:

  • The Retirement Plans Experience Committee (RPEC) and the SOA are working on a mortality study specifically for public pension plans in the United States. Based on RPEC’s preliminary findings, results of this analysis suggest that mortality assumptions for many plans may be lagging behind current aggregate mortality experience among public plans.
  • Mortality assumptions for teachers tend to reflect longer life expectancies than for other job categories. For females, mortality assumptions for public safety employees tend to reflect shorter life expectancies than for general employees. Assumptions for males reflect the opposite.

Report

U.S. Public Pension Plan Mortality Assumptions

Thank You

The author thanks the following volunteers for their advice, insights and arm’s-length review of this study prior to publication. Any opinions expressed may not reflect their opinions nor those of their employers. Any errors belong to the author alone.

David L. Driscoll, FSA, EA, FCA, MAAA

Timothy J. Geddes, FSA, EA, FCA, MAAA

David T. Kausch, FSA, EA, FCA, MAAA, MSPA

Laurence Pinzur, FSA

The author also thanks the following Arcadia University students and professor for their assistance and insights while gathering the data used in this analysis. Any opinions expressed may not reflect their opinions nor those of the university.

Allegra Benites

Lili Liu

Jesse Marass

Zheng Sun

Yang Tan

Yuqi Xu

Irina Pogrebivsky, FSA, EA

Questions or Comments

If you have comments or questions, please email research@soa.org.