UK. Impact of COVID-19 on life expectancy could reduce pension scheme liabilities by up to £90bn
Impact of COVID-19 on life expectancy could reduce pension scheme liabilities by up to £90bn
- New XPS forecasting shows long-term vulnerabilities in pension schemes following the pandemic.
- In some scenarios the long-term economic impact of COVID-19 on life expectancy could be 50% higher than the short-term impact of the pandemic.
- The economic impact on schemes’ assets is also a significant consideration. Especially for those schemes holding growth assets and/or with low hedging ratios.
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22nd July 2020: XPS forecasts that the long-term impact of COVID-19 on life expectancy could cause a reduction in liabilities by as much as 5% across the DB universe, according to its newly launched COVID-19 Impact Analytics. This new service is the third and final element in XPS’ COVID-19 response which provides pension schemes with a holistic view of the pandemic, including:
- 1. The impact of the virus on different population groups via the XPS COVID-19 Tracker, which consolidates publicly available data on the pandemic in one place.
- 2. The impact of the virus at an individual scheme level via the Scheme Vulnerability Analysis, which takes into consideration factors such as where members live and prior health conditions.
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