Programme Directors: K. Howse, G.W. Leeson and S. Harper

This is a joint programme with the PCAP Centre.

This research is being expanded by 2 new positions - a joint research fellowship with Economics (see Vacancies) and a visiting position in financial statistics and actuarial science

Of particular interest is the continued growth in longevity and the impact this has on individual’s capacity to financially plan across their lives. Lack of financial planning and financial preparedness for retirement is an acknowledged problem in many countries. The Longevity and Risk Programme at the OIA examines these key questions asking whether and how our present understanding of the determinants of recent mortality trends should be incorporated into projections of future mortality trends. Initial work by Leeson and Harper suggest that in terms of riskpeople have great difficulty assessing the scope of their financial security in old age: This is due to:

• Lack of retirement preparedness
• Lack of financial literacy
• Overestimation of the financial robustness of retirement investment,
• Underestimation of one’s longevity.

Understanding personal longevity is complex and it is clear that neither scientists nor professional advisors, let alone individuals themselves, understand the current increases in longevity. Longevity risk is thus poorly understood and not well-planned for. The main factors in mortality decline are increasing standards of living, better public health infrastructure, improved personal hygiene, medical care and drug use is now also making an impact in extending later life. Howse’ analysis has identified key questions including:

• Chronic degenerative diseases are now the main causes of death in the populations of the developed world. Is it realistic to expect ‘cures’ for any or all these diseases?
• Disease prevention often means just delaying the onset of disease to later ages. Are we increasing the age of onset without being able to reduce the lifetime risk?
• There is strong evidence to show that early life factors effect late life disease and mortality. What are the relative importance of various risk factors at different stages of the lifecycle? 

The Longevity and Risk Programme at the OIA examines these key questions. In particular it asks whether and how our present understanding of the determinants of recent mortality trends should be incorporated into projections of future mortality trends.