At the NASI annual meeting on January 27, some comments were made about mortality improvement. They require further elaboration and correction. The Society of Actuaries studies mortality to construct mortality tables for a variety of purposes, and to understand what is happening to high age mortality. It has had a special multi-disciplinary project on high age mortality and how it is improving for about the past ten years. The Living to 100 and beyond project papers and presentations can be found at http://livingto100.soa.org/.
Here are some key points about mortality improvement in the United States:
For the past 50 years, there have been major improvements in mortality within traditional retirement age ranges. The consequence of this is that periods of retirement have lengthened a great deal since Social Security started.
The table below reinforces just how much life spans have changed without very much change in normal retirement ages.
Life Expectancies of the U.S. Population, By Age and Calendar Year
Source: Social Security Administration, Actuarial Study Number 120, Table 10, Life Tables for the United States.
Mortality is continuing to improve, but there is disagreement about how rapid the improvement will be in the future, and whether the rate of improvement will slow or increase. Some experts expect future improvements to be slower than the improvements of the last fifty years. Obesity is a factor contributing to the slowing of mortality improvement, but scientific breakthroughs are still a possibility.
Social Security mortality projection factors illustrate one set of projection factors developed after substantial study of improvement. Improvement factors are used in the actuarial valuations for Social Security, many private pensions and annuity contracts.
There are significant differences in mortality improvement by group, including racial and class/income differences. However, racial differences are not reflected in insurance and pension mortality studies, as these systems do not maintain data by race. Insurance companies are generally not permitted to consider race in pricing. Several of the 2011 Living to 100 papers show differences by race.
Mortality in the U.S. is not the lowest in the world, and some other countries have faster declines in mortality.