Market Overview

Ruark Consulting Releases Annuity Industry Mortality Studies


Variable annuity mortality falls 3%

Ruark Consulting, LLC has released the results of its 2018 studies of
variable annuity (VA) and fixed indexed annuity (FIA) industry
mortality. Highlights include:

  • Aggregate variable annuity mortality has declined 3% since 2015,
    attributable to a combination of underlying mortality improvement and
    changes in business mix.
  • Mortality results vary by product features, contract size, and tax
    status. Most notably, contracts with living benefit features exhibit
    much lower mortality than those without.
  • Ruark's proprietary annuity mortality table provides a much better fit
    to VA and FIA experience than even recent standard industry annuity

The studies are based on experience from twenty-seven companies from
2008 through 2017, and over $1 trillion of current account values.

"We have 60% more data than our last studies, allowing for high
credibility even when splitting results by multiple factors of
influence," said Timothy Paris, Ruark's CEO. "Moreover, we now have a
lot more experience after the end of the surrender charge and bonus
periods, commonly 7-10 years. As a result, these studies provide new and
important insights into long-term annuity mortality, which should help
issuing companies to refine their product designs, pricing, and risk
management for these widely-used retirement savings and income products,
particularly with pending changes to regulatory requirements."

Detailed study results, including company-level analytics and customized
behavioral assumption models calibrated to the study data, are available
for purchase by participating companies.

Ruark Consulting, LLC (,
based in Simsbury, CT, is an actuarial consulting firm which aims to be
the platform and industry benchmark for principles-based insurance data
analytics and risk management. Ruark's consultants are frequent speakers
at industry events on the topics of longevity, policyholder behavior,
product guarantees, and reinsurance. Their work and commentary have
appeared in numerous industry publications. Ruark enjoys an ongoing
collaboration with the Goldenson Center for Actuarial Research at the
University of Connecticut.

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