View more on these topics

&#39Actuarial miscalculations on life expectancy have hindered planning&#39

Serious underestimations of future life expectancy by actuaries are one of the main causes of the pension crisis, claims Pensions Commission chairman Adair Turner.

Speaking to an ABI fringe meeting at the Labour Party conference ahead of publication of the commission&#39s report on October 12, Turner attributed part of the pension problem to the industry relying on inaccurate life expectancy predictions.

In 1981, the Government Actuaries Department estimated that, by 2004, 65-year-olds would have an average life expectancy of 14.8 years while latest figures show that life expectancy at 65 has actually increased to 19 years.

Turner said the figures show that life expectancy after 65 is increasing by one year every five years.

He told the meeting: “Actuaries have underestimated substantial changes that have occurred. This has huge implications for public pensions.

“We are assuming longevity that is a third less. Anybody running a private defined-benefit pension plan was getting it wrong by 30 per cent.”

ABI director general Mary Francis has already said she believes the commission will recommend that the Government adopts compulsory pensions in the workplace.

Recommended

Sharp increase in online business – GMAC-RFC

Ninety eight per cent of all intermediaries are conducting at least some of their business online and nearly half of those questioned stated that they had seen their on-line activities more than double, according to new research from GMAC-RFC. Ninety four per cent of intermediaries reported their online business increasing in the last year, with […]

Which? claims ABI&#39s contracting-out factsheet &#39implies serious concerns&#39

Six million pension policyholders are to receive a factsheet aimed at helping them decide whether to stay contracted out or rejoin the state second pension. The factsheet, produced by the ABI and Aifa, will be sent out by life and pension companies as well as IFAs over the next three months. But Which? magazine has […]

Out of context

•”I cut my hand last week so I haven&#39t been able to do much. I&#39ve been living like a student all weekend and it&#39s great.” – NU media relations executive Rob Pell. •”We decided on putting in the colon as without it, we looked we were calling ourselves CHOMPING, which isn&#39t nice.” – CCHM&#39s Rebecca […]

Savills buys specialist broker Sherwins

Savills Private Finance is acquiring specialist broker Sherwins Mortgage Services for an undisclosed sum. Sherwins specialises in mortgages for the affordable homes market. Sherwins, which usually focuses on the south east of the UK will now be expanding nationally.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com