Bit of a long shot, but I'd be grateful if someone is able to help clarify
the following issue a little further:
If you produce Pension illustrations, or produce a Pension Transfer Analysi
s, certain steps need to be taken in order to produce a compliant document.
One step is to determine the correct mortality rate in order to use the co
rrect annuity factor when calculating the projected pension at a future dat
Previously, PMA92/PFA92 tables were used, and the FSA used to actually publ
ish the formula about how to calculate the factor.
(1+E)*[än(12) + Dx+n /Dx * äx+n(12)]
However, the PMA92/PFA92 tables are now well out of date, and we are instru
cted to use the '00' series. Now, if we look at the current FSA Conduct of
Business Handbook, the only references, in sections 13 & 19 state:
(g) the mortality rate used to determine the annuity is based on the year o
f birth rate derived from each of the Institute and Faculty of Actuaries' C
ontinuous Mortality Investigation tables PCMA00 and PCFA00 and including mo
rtality improvements derived from each of the male and female annual mortal
ity projections models, in equal parts;
For any year commencing 6 April, the use of the male and female annual CMI
Mortality Projections Models in the series CMI(20YY-1)_M_[1.25%] and CMI(20
YY-1)_F_[1.25%], where YY-1 is the year of the Model used, will tend to sho
w compliance with COBS 13 Annex 2 3.1 R (2).
(These can be located at 1 & )
Now, I can get the mortality rate, but am sure about how to apply the morta
lity improvements. The latest CMI working model is the CMI_2011 model (http
Is anyone familiar with this spreadsheet? As I'm having problems determinin
g which projections are the ones I should be using and how to derive the co
Any help appreciated.
- posted 7 years ago