Life & health insurance and funding longer lives
Life and health (L&H) insurance products play a crucial role in creating stability for individuals and society. They provide financial security in the event of death or illness, give access to medical treatment and offer dependable income in retirement. We help primary L&H insurers and other clients from the private and public sector to manage such risks efficiently, thanks to our specialist knowledge of mortality, morbidity and longevity trends.
Longevity and health insurance remained two of our strategic priorities in the L&H business. The demand for longevity solutions is expected to grow further as demographics shift. We keep investing in research and development to improve our ability to predict mortality and longevity trends.
Demand for commercial health insurance solutions has also been growing, driven by several major demographic and socio-economic trends. These include: the greater healthcare needs of ageing societies; rising healthcare expectations of the new middle class, especially in growth markets; and healthcare finance reform, particularly in mature markets. We offer a variety of health reinsurance solutions to meet these needs, from short-term protection against the risk of volatility in medical expenses for insurers or employers to very long-term protection against the financial impact of disability or critical illness.
With life expectancy rising, pension schemes face the risk that they will not be able to meet all their commitments. Longevity transactions cover this risk by insuring the schemes’ liabilities in case their members live longer than expected. In previous Corporate Responsibility Reports, we have described a number of landmark longevity transactions completed in recent years with different clients in the UK:
- The Scottish & Newcastle Pension Plan (19 000 members)
- The Aviva Staff Pension Scheme (19 000 members plus partners)
- One of AkzoNobel’s pension funds (17 000 members)
- The LV= pension fund (more than 5 000 members)
- The Royal County of Berkshire Pension Fund (11 000 members).
In 2017, we completed further longevity transactions but, for confidentiality reasons, are unable to publish any details on them. You can read more about our recent efforts to raise the topic’s public profile in Funding the needs of ageing consumers.