Longevity for Canadian pensioners is lower than expected, according to data from Club Vita Canada Inc. – a longevity analytics firm for Canadian pension plans and a subsidiary of Eckler Ltd.
The study results, announced Feb. 21, say Canadian male pensioners are living about 1.5 years less than expected from age 65. Female pensioners are living about half a year less than expected.
Overly conservative approach
Ian Edelist, CEO of Club Vita Canada, says that based on this data, defined benefit pension plans may be “overestimating how long their members are currently living and are therefore taking an overly conservative approach to funding their liabilities."
He adds that “correcting that overestimation could reduce actuarial reserves by as much as 6% – improving Canadian pension funds' and their plan sponsors' balance sheets just by using more accurate, granular and up-to-date longevity assumptions."
Tracking more than 500,000 Canadian pensioners
The data comes from Club Vita Canada's first annual longevity study completed in 2016 on the impact of longevity on defined benefit pension and post-retirement health plans. The company says it is currently tracking more than 500,000 Canadian pensioners from over 40 pension plans.
Club Vita Canada Inc., created by Eckler Ltd., is an extension of Club Vita LLP, a longevity centre launched in the U.K. in 2008 by Hymans Robertson LLP.
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