Report Suggests Longevity Projections are Underestimated

A recent research report from Swiss Re suggests that life expectancy increases over the past several decades have been consistently underestimated. 

The report, titled “A window into the future: Understanding and predicting longevity,” examines the traditional methods of forecasting life expectancy—both of which are largely based on historical trends. 

For example, the “blending approach” combines historical data with assumptions about the future.  A second approach relies on stochastic models which draw on historical data. 

The gist of the criticism of conventional approaches is that these models fail to adequately account for new and emerging factors that would prove to be meaningful drivers of longevity in the future. 

The primary effect of the underestimating longevity are pension funding difficulties facing many employers, insurers and governments. 

The authors suggest that forward-looking life expectancy models “provide better estimates of future longevity and will play a vital role in the overall solution.” 

Source: Swiss Re