The
Groupe Consultatif Actuariel Europeen published end 2005 a study, which for the first time compares how companies in different European countries measure life expectancy for their pension schemes. It reveals vast differences in mortality assumptions and indicates that practice across the EU varies widely when assessing company pension liabilities.
As you may see from some examples to the left, a wide area of classic mortality formulae in the different European countries passes by.
It's clear that that mortality assumptions in company pension schemes vary from
country to country, due to variations in underlying population mortality as well as in
variations of the profile of typical membership of a company pension scheme. However, the
variations in mortality assumptions are much greater than would be justified by these
factors alone.
Some of the variation is due to the fact that some countries incorporate an allowance
for expected future improvements in mortality, while others use tables that relate to mortality observed over a period in the past, without allowing for the fact that life expectancy continues to increase.
The total actuarial deficit with regard to (future) longevity in company pension schemes is substantial.
As a '
Survey of Actuarial Education in Europe' showed, not only mortality rates differ, but also the the education of different European actuarial professionals.
In short, work enough for actuaries.
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