Tue 23 May 2023 - Decumulation-only CDC schemes, which pool longevity risk only, can offer a menu of options to new retirees. For example, a joint life income, which pays an income to a retiree’s partner upon death, can be offered instead of a single life option. Similarly, a minimum income guarantee could be offered.
Earlier work in the research programme showed how a bequest upon death could be offered.
In the studied scheme, longevity risk is shared by allocating the funds of those who have died among the surviving retirees. In this webinar, we show how to calculate the allocation to provide a joint life income. Some related issues and solutions are also discussed.
Our recent results on the provision of a minimum income guarantee in these schemes are also outlined.
Catherine Donnelly is a Professor in the Department of Actuarial Mathematics and Statistics at Heriot-Watt University and is Director of the Risk Insight Lab. Prof. Donnelly is a qualified actuary who has previously worked in the pensions industry. She has a PhD from the University of Waterloo, Canada, an MSc from the University of Oxford and a MA from the University of Cambridge. Her research interests lie in pensions and life insurance, and she has published widely in these areas. She was a member of the USS Joint Expert Panel in 2018. Prof. Donnelly has a keen interest in developing workable solutions to improve people’s financial situation in retirement.
Policy Manager at Institute and Faculty of Actuaries