Pandemic Disruption Forces Reevaluation of Mortality Models, LCP Report Finds

Lane Clark & Peacock’s (LCP) recent publication, "Unlocking Mortality Trends: A Key to Better Outcomes," delves into the substantial impact of the COVID-19 pandemic on mortality trends and the subsequent strain on traditional actuarial models. The report underscores the challenges faced by pension schemes in adapting to new mortality projections, particularly emphasizing the limitations of the CMI model currently used in the UK.

The findings highlight a potential decline in life expectancy unless significant changes are made to the mortality models. LCP’s analysis suggests that adjustments are necessary for more accurate future predictions, reflecting less reliance on post-pandemic mortality data. This shift is crucial for trustees and sponsors managing pension schemes to make informed decisions about future liabilities.

Moreover, LCP’s report explores broader health implications, noting potential increases in cancer-related deaths due to diagnostic delays and the impact of emerging obesity treatments on longevity. The multifaceted approach by LCP integrates insights from actuaries, epidemiologists, and healthcare professionals to provide a comprehensive view of the factors influencing mortality rates. This collaborative effort aims to offer more robust and informed mortality assumptions critical for the effective management of pension schemes.