Mercer strikes five-year longevity risk partnership with Club Vita
Mercer, a wholly-owned subsidiary of Marsh & McLennan Companies, has entered into a five-year partnership with longevity analytics firm Club Vita.
The partnership will see Mercer offer Club Vita’s longevity risk reporting tools to its clients in the United States.
Mercer’s US pension plan clients will have access to Club Vita’s proprietary longevity assumptions, analytics and reporting, that will help them better assess and manage their plans’ longevity risk.
In addition, the aggregate enhanced data set will also be used by Mercer’s consulting teams to provide more insights to help with client decision making.
Bruce Cadenhead, chief actuary, Mercer, said: “Longevity has become a crucial focus for plan sponsors as people are living longer, particularly in the current low interest rate environment. By working with plan sponsors to collect more insightful data, we can tailor each plan’s assumptions to their participants, increasing transparency and in turn, improving the value in pension risk transfer deals. Access to this data will help to justify lower pension liabilities in some cases.”
Dan Reddy, US CEO, Club Vita, said: “We aggregate longevity data to aid anyone who wants to be better informed about the true cost of their pension plan. By combining Mercer’s data with ours, and adding in our analytical strengths, we will empower pension plan decision makers to decide the best strategies to manage the costs associated with their plans.
Mr. Reddy concluded: “In a recent pilot program, we tested data aggregated from over 100 US pension plans. We found increases and decreases in pension plan liabilities of up to 6% relative to the standard Society of Actuaries tables, with a reduction in liabilities on average.”
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