UK - Nearly half of the FTSE 100 companies amended the mortality assumption of their pension scheme last year adding around £6bn (US$11.7bn) to the index's liabilities, according to Watson Wyatt.
Nicola van Dyk, senior consultant, Watson Wyatt, said companies felt able to afford this change: "They shouldered the additional cost of building in changed mortality assumptions in a year when asset returns were generally good and bond yields - which have a major impact on liability calculations - were at a high level."
Watson Wyatt figures predicted the cost of the change in liability estimations would range from 2.5% to 6%.
Van Dyk added companies were engaged in reducing uncertainty in defined benefit (DB) pension funds. They had become increasingly conscious of longevity and investment risk in current markets.
Recent Accounting Standards Board proposals, if implemented, could see a rise in liabilities of up to £100bn, but there has not yet been concrete information on when and how they would take effect.
Van Dyk concluded: "The longevity changes are, by contrast, concrete and in the here and now, and reflect an expectation of increased real cost of benefits due to members living longer, rather than a change in the approach to measurement."
Watson Wyatt analysed the annual reports of 21 FTSE100 companies with 2007 calendar year ends.
It found ten firms had changed their mortality assumptions to allow for increases in longevity.
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