On the go: The mild UK winter could lead to an increase in pension scheme liabilities as 2019 to date has seen relatively few deaths, according to a firm of longevity specialists.
Conor O’Reilly, head of analytics at Club Vita, said it was unclear whether this “bounce back” is a blip, or a return towards the high levels of mortality improvements seen through much of the 2000s.
“The most recent version of the [Continuous Mortality Investigation]’s mortality improvements model, CMI_2018, could lead to liabilities that were around 2.5 per cent lower than under the previous version (although around half of this was due to a technical change in the model’s ‘core’ calibration),” he said. “There are signs that 2019 is (so far) turning out somewhat different to recent years though.”
The latest version of the CMI’s quarterly Mortality Monitor, covering its analysis of the ONS data for the first half of 2019, shows that the annual average standardised mortality rate (the rolling average of weekly SMRs over successive 53 week periods) has fallen steadily from mid-2018 to mid-2019.
The cumulative SMR is well below the average of the previous 10 years, similar to that seen in 2014, which saw the lowest mortality rates over the last decade.
Mr O’Reilly comments in his blog: “July has seen record breaking heat. And of course time will tell what winter brings (given the trend towards more extreme weather events). In addition, Australia saw an early start to its flu season – although there are signs that it may finish earlier too (and what happens in Australia is typically a good indicator of what to expect in our next flu season in the UK). Therefore there remains plenty of scope for things to change in the remaining half of the year.”
