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CMI consults on significant changes to mortality projections model

25 February 2025

The Continuous Mortality Investigation (CMI) has proposed significant structural changes to the next annual update to the CMI Mortality Projections Model, CMI_2024, which is due to be released in the second quarter of 2025. For the core version of the model, those changes would lead to cohort life expectancies at age 65 that are about five weeks higher for males and about one week lower for females than in the current version of the CMI Model, CMI_2023.

The CMI Model is used by pension schemes, insurers and reinsurers, both in the UK and internationally, which need to make assumptions about future mortality rates. 

The first proposed change is to explicitly model the impact of the pandemic on mortality:

  • The CMI previously dealt with the exceptional mortality experience in 2020 and 2021 by excluding those years when calibrating the CMI Model and fitting a smooth trend to other years. Those years seemed likely to be outliers and not indicative of the future path of mortality.
  • This worked well in the early stages of the pandemic. However, five years on, a better approach is possible now that we have a clearer picture of how mortality has developed.
  • Under the proposal, the CMI Model would include an explicit mortality shock in 2020 with the impact reducing in each successive year.

The second change would allow the model to adapt better to situations where different trends in mortality emerge at different ages:

  • The structure of the current version of the model, CMI_2023, leads to similar changes in mortality trends over time at all ages. However, this has not been seen in practice in recent years. 
  • Mortality in 2024 for ages 75-100 was lower than in any other year, but mortality in 2024 for ages 20-44 was materially higher than before the pandemic. 
  • Updating the structure of the CMI Model to allow for different changes in trends at young, middle, and old ages better reflects recent experience. 

The CMI is seeking views from its subscribers. The consultation is open until 25 March 2025 and the CMI aims to provide an update on its plans for CMI_2024 in April. 

Cobus Daneel, Chair, CMI Mortality Projections Committee, said: “The COVID-19 pandemic was challenging for all mortality projection models. It was uncertain how mortality rates would react beyond the initial shock and the CMI took a pragmatic approach, avoiding material revisions in projected life expectancies until a clearer picture emerged. We excluded data from the peak of the pandemic, as these rates were unlikely to be a good guide to the future, and smoothed through data for other years, focussing on a plausible level of mortality rates in the medium term. 

“That approach worked well initially, but required subjective judgements regarding how much emphasis should be placed on recent data. 

“Now that mortality at pensioner ages is closer to pre-pandemic levels, we have an opportunity to improve the CMI Model, providing a better fit to recent data across the full age range during and after the pandemic.

“We recognise that different users of the model have different views. The CMI Model provides a framework for them to adjust parameters to reflect their own portfolios and views on the impact of the pandemic, and to communicate those to others.”

For more information on the current version of the CMI Model, CMI_2023, please see the FAQs.

The CMI produces ‘mortality monitors’ – with detailed analyses of emerging mortality quarterly and more frequent summaries.

~ENDS~

Notes to editors

  1. Cohort life expectancy allows for assumed future changes in mortality rates. As future changes are unknown, it is a subjective measure. It is typically used by actuaries who need to use realistic assumptions about the lifespan of pension scheme members or insurance company policyholders. In contrast, period life expectancy only allows for changes in mortality rates to date and makes no allowance for future changes. It is an objective measure that is often reported by the Office for National Statistics.
  2. The CMI Mortality Projections Model (the ‘CMI Model’) was introduced in 2009 to replace previous projections and has been updated on a broadly annual basis since then. It is based on mortality data for the population of England and Wales, published by the Office for National Statistics.
  3. The CMI Model is typically used by UK pension schemes and insurance companies which need to make assumptions about future mortality rates. The model does not provide an assumption around long-term mortality improvements, requiring users to make their own assessment.
  4. Life expectancy for different groups, such as particular pension schemes and groups of policyholders, can vary considerably, and the CMI encourages users of the CMI Model to make appropriate assumptions for the purpose that it is being used for.

 

Contact

Hannah Patmore, Communications Manager, IFoA  
Tel: 07519106714  
Email: hannah.patmore@actuaries.org.uk  

 

About the Continuous Mortality Investigation

Continuous Mortality Investigation Limited (‘the CMI’) is wholly owned by the Institute and Faculty of Actuaries but has an independent executive and management.

The CMI’s mission is to produce high-quality impartial analysis, standard tables and models of mortality and morbidity for long-term insurance products and pension scheme liabilities on behalf of subscribers and, in doing so, to further actuarial understanding.

 

About the Institute and Faculty of Actuaries 

The Institute and Faculty of Actuaries (IFoA) is a royal chartered, not-for-profit, professional body.  

Research undertaken by the IFoA is not commercial.  As a learned society, research helps us to fulfil our royal charter requirements to further actuarial science and serve the public interest.   

Actuaries provide commercial, financial and prudential advice on the management of a business’s assets and liabilities, especially where long term management and planning are critical to the success of any business venture. They also advise individuals, and advise on social and public interest issues. 

Members of the IFoA have a statutory role in the supervision of pension funds and life insurance companies. They also have a statutory role to provide actuarial opinions for managing agents at Lloyd’s of London. 

Members are governed by the Institute and Faculty of Actuaries. A rigorous examination system is supported by a programme of continuing professional development and a professional code of conduct supports high standards reflecting the significant role of actuaries in society. 

The IFoA is available to provide independent expert comment to the media on a range of actuarial-related issues, including COVID-19 and its long term consequences, mortality, pensions, life and general insurance, health and care, finance and investment, climate change and sustainability, systems thinking, uncertainty and judgement, and risk management.