September 11, 2013

CAAR – Pensions Institute (Cass Business School, City University of London) [UK] Working Paper – September 11, 2013

Filed under: Working Papers — Tags: — admin @ 4:03 pm

Longevity Insurance Annuities: Lessons from the United Kingdom,” David Blake and John A. Turner (PI13-05, July 2013, .pdf format, 12p.).


Recent U.S. Treasury Department proposals have focused attention on longevity insurance annuities. These are deferred annuities that began payment at advanced older ages, such as at age 82. While the United Kingdom has by far the world’s largest annuity market, and some insurance companies used to provide longevity insurance annuities, currently no companies provide these annuities. The main reason this change has occurred is that proposed European Union regulations will require insurance companies to increase their reserves for these annuities in recognition that there is no asset available to effectively hedge the risk of unexpectedly large improvements in life expectancy.

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