New SAPS tables

On 31st October 2008 the CMIB published the new SAPS S1 mortality tables based on the mortality of defined-benefit pension schemes. These tables follow the previous release of the '00 Series' mortality tables based on the mortality of life-office pensioners.  It is instructive to compare the life expectancies under the two series.

One drawback is that there are rather a lot of tables in the S1 series: ten in total.  We will use the so-called amounts tables, i.e. mortality as weighted by the size of the annual pension, as this gives a better indication of the financial importance. The life expectancies below are calculated using the S1PMA and S1PFA tables from SAPS S1, and the slightly older PCA00 table.

 PCA00S1PAChange
AgeMalesFemalesMalesFemalesMalesFemales
6518.420.918.120.6-2%-1%
7014.516.714.216.5-2%-1%
7511.012.910.812.8-2%-1%
808.19.77.99.5-3%-2%
855.97.05.66.8-4%-3%

So the newer SAPS tables are producing lower life expectancies than the 00 Series tables. How can this be if mortality is continuously improving? The answer most likely lies in the SAPS data having a higher proportion of lower-status lives.  In practice it will make little difference if an actuary uses a life-office table or a SAPS table, as demonstrated here.  Indeed, we earlier posed the question whether actuaries need standard tables at all.  Most life offices and large consultancies have data sets which can be used to create tables which are are much richer in risk factors.

 

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Stephen Richards
Stephen Richards is the Managing Director of Longevitas
Table generation in Longevitas
Longevitas will automatically generate rate tables corresponding to each fitted model.  Alternatively, for complicated models, Longevitas can also generate a rate table for each life in the portfolio.  These individual-member rate tables are specific to the exact age and risk combination of each life.