UK - The Pensions Regulator (TPR) has published a statement regarding its regulation of mortality assumptions for defined benefit (DB) schemes.
Tony Hobman, CEO, TPR, said there had been developments in the understanding of mortality trends: "It is the regulator's view that some projections that have been in common use can no longer be considered reasonable assumptions.
"We wish to bring these developments to the attention of trustees and outline how they should go about deciding on funding assumptions for defined benefit schemes."
TPR said it would scrutinise funds which appeared to use mortality assumptions that appeared to be weaker than the long cohort assumption and those which those which assumed the rate of improvement tended towards zero without some sort of underpin.
Hobman added: "Scheme members living longer adds to the cost of pensions and it is right that schemes recognise this in their funding."
Consultants and actuaries called on TPR to consider socio-economic reasons for pension funds using different mortality tables to that specified by its own guidelines.
TPR said these guidelines would be subject to industry-wide consultation which would end on 12 May 2008.
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