Description: A common approach to estimating the total amount of savings required to fund retirement is to first apply a generic “replacement rate” to pre-retirement income, such as 80%, to get the desired retirement income need. That need is then assumed to increase annually at the rate of inflation for the duration of retirement, which is generally assumed to be some fixed period, such as 30 years. Using government data along with a fairly simple market and mortality model, we explore these assumptions to more accurately estimate the true cost of retirement

Description: We introduce a logistic regression-based modeling approach for analyzing the U.S. insured mortality experience, including at advanced ages where less credible experience data are available. As a validation, we create a version of industry basic experience tables based on the model-estimated mortality and compare them to standard industry experience tables produced by the Society of Actuaries (SOA). The conclusion is that properly designed logistic modeling processes can more efficiently utilize available data to deliver solutions for multiple needs, including: a) testing mortality drivers’ statistical significances in explaining mortality variations; b) estimating normalized mortality slopes and mortality differentials such as how mortality increases by duration or varies between underwriting classes while product and attained-age distributions are controlled; and c) addressing analytical challenges such as extrapolating for ultimate mor tality, smoothing between select and ultimate estimations, and constructing multidimensional basic experience tables.

Description: Exposure to cigarette smoke has had and will continue to have a huge effect on mortality. Significant differences in smoking prevalence rates by gender have contributed to differential levels and rates of improvement in mortality and are expected to continue to influence mortality improvement differently over the next several decades. This paper compares smoking prevalence and cessation by gender and their effect on smoking-attributable and, in turn, all-cause mortality. A summary of mortality attribution approaches used to evaluate the effect of smoking and projections of mortality rates by gender is also provided.

Description: This article looks at changes in life spans and retirement ages. The changes are completely out of sync. The history of retirement and retirement ages is reviewed. The article finds that while life spans were increasing for many years, retirement ages were dropping and then they had a modest increase recently. There are parallel issues in many countries and some international data is provided. The issue of working as part of retirement and phased retirement are introduced. The article concludes that more change is needed and that the failure to keep retirement ages updated is one of the reasons for the decline in defined benefit plans.

Description: Abstract for Contribution of Familial Longevity to Living to 100

Description: The author constructed the efficient frontier of new business sales by modeling the embedded value and economic capital against a universe of possible growth rates of the three lines of business in a typical three-year planning horizon. The ERM function can use the efficient frontier of new business to provide a more rigorous analysis of the impact of growth rates on the firm’s overall capital efficiency and value creation, hence forming a feedback loop with the businesses in the planning process to optimize the growth strategy.

Description: Mortality in the U.S. states at ages 80 and older and over years 1959–2011 analyzed and compared with mortality levels in 13 high-longevity countries.

Description: We ask whether we can find support for the previously reported upper limit of the force of mortality of 0.7, i.e. about the probability of tossing a fair coin.

Description: Chapter 2 reviews previous research in the area of health risk assessment. From A Comparative Analysis of Methods of Health Risk Assessment, M-HB96-1.