The Danish Financial Supervisory Authority plans to release mortality benchmarks which will be used to help calculate pension liabilities.
Per Plougmand Baertelsen, director of the pension and life insurance division at Finanstilsynet, said the regulator would be issuing a benchmark for observed mortality rates and one for expected future development in life expectancy. The benchmarks were due to be released imminently, but had not been as of press date.
He said: “We have made the benchmarks and we will ask the companies to compare themselves against the benchmarks.” He revealed the news at the Pension Fund Forum Denmark held on 24 November in Copenhagen, organised by GP’s parent company Incisive Media.
A review of various companies showed data on life expectancy varied widely. Using a retirement age of 60, life expectancy ranged from about an additional 23 years to nearly 26 years.
“We need to make sure that the companies put aside enough money to cover their liabilities,” said Baertelsen. “For the time being there are large differences between the companies’ life expectancy assumptions.”
He admitted that differences in life expectancy could come down to the industry the member works in, and said companies that deviate from the benchmark will be able to explain their method to the regulator.
He declined to say what the government’s life expectancy data will show.
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