Memo to Nicole Seguin re future governance of the task ... · j:\rfi\2009\mas\iaaust\memo to nicole...

$: Memo to Nicole Seguin re future governance of the task ... · j:\rfi\2009\mas\iaaust\memo to nicole seguin re future governance of the task force v2.doc Appendix B Data Bases SOA$
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Not Peer Reviewed

Memo

To: Nicole Seguin

Date: 10 September 2009

From: Martin Stevenson

Subject: Future Governance of the Task Force

The IAA Mortality Task Force was set up with the intent of having a limited duration. However it became apparent to the members of the Task Force that there was a need for a long term IAA entity devoted to the study of mortality. At the IAA Committee meetings in Tallinn, Paul Thornton and Yves Gerard also raised this issue with me. The purpose of this memo is to recommend that the Task Force become a permanent entity rather than a temporary group. Working Group or Section Two structures have been suggested for the new form of the Task Force: a Working Group or a Section. A Working Group is not mentioned in the governance of the IAA (but then neither is a Task Force). The Working Group would operate similarly to the Task Force, but would have an indefinite term of existence. Membership would be determined on expertise and interest criteria, rather than on country quotas (although the principle of subsidiarity would be maintained). The term Working Group captures the spirit of its members focussing on a branch of actuarial science rather than on an area of actuarial employment. Sections are included in the IAA’s governance. By and large the Sections reflect employment fields of actuaries – Life Insurance, Non-Life Insurance, Health, Pensions and Social Security etc. An actuary specialising in mortality and working in a life insurance company is more likely to describe him or herself as a Life Insurance actuary rather than a mortality actuary. Mortality spans a number of Sections: it is relevant to Life Insurance, Health, Pensions and Social Security. The Sections raise funds through a levy on interested members; it is difficult to see how a Mortality Section could successfully use this route. Based on the above brief analysis my conclusion is that it is preferable for the Task Force to become a Working Group rather than a Section.

10 September 2009 Nicole Seguin

j:\rfi\2009\mas\iaaust\memo to nicole seguin re future governance of the task force v2.doc

Current Terms of Reference Appendix A sets out the current Terms of Reference and provides comments on what the Task Force has achieved and / or address the issue of each Term. In essence, Appendix A brings closure to the Task Force. Proposed Terms of Reference for the Working Group Based on the experience gained by the Task Force in the eighteen months of its existence, and assuming that the Task Force becomes a Working Group, the following Terms of Reference are recommended: To monitor data collection efforts internationally and to facilitate continuous improvement in the quality and extent of data collection. To coordinate the work done by different Sections and Committees of the IAA in the area of mortality, especially when this involves cooperation with other international bodies. To extend the body of knowledge of the international actuarial community in respect of mortality through - research - encouraging actuarial research - collection of research from both actuarial and non-actuarial sources - making research accessible to actuaries globally - presentations and papers at professional seminars, colloquia,

conferences etc. - encouraging and co-ordinating other actuaries to produce presentations

and papers at professional seminars, colloquia, conferences etc. Recommendations 1. That the IAA Mortality Task Force be reformed as the IAA Mortality Working Group. 2. That the Terms of Reference be those set out in the preceding section of this memo. 3. That the initial members and officers of the Working Group be the current members

and officers of the Task Force.



Auspices This memo has been prepared by myself and peer reviewed by the two Vice Chairpersons: Bill Horbatt and Henk van Broekhoven. The Task Force has agreed in principle to becoming a permanent entity. Martin A Stevenson Chairperson IAA Mortality Task Force



Appendix A

Brief Comments on the Terms of Reference of the IAA Mortality Task Force

The purpose of this Appendix is to set out the existing Terms of Reference of the Task Force and to provide comments on each item. To conduct a study of current data collection efforts internationally and to create guidelines that appropriate data is available. Four data bases were identified:

§ SOA Table Manager § Human Mortality Database (HMD) § Continuous Mortality Investigation (CMI) Library § World Health Organisation

Descriptions and presentations in respect of these data bases are included in Appendix B. To co-ordinate the work done by different Sections and Committees of the IAA in the area of mortality, especially when this involves cooperation with other international bodies. Initially, contact was made with all Sections and Committees. Some interest was shown by the Social Security Committee, Pension and Employee Benefits Committee, Life Committee and Supranational Committee. Communication is maintained with these Committees mainly through distribution of material relating to our meetings held in conjunction with the IAA Committee meetings. Through Social Security and Supranational Committees we have commenced dialogue with the World Bank. We also provide input to IOPS. The Task Force is also working constructively with the ICA Organising Committee and sections to organise a “mortality stream” at ICA 2010.



To conduct a survey of current international research on mortality to determine future needs in this area and begin to facilitate a process to enhance future efforts of actuaries in this area. The Task Force has not formally conducted a survey on current international research. Rather, members of the Task Force have presented and made available leading edge material on aspects of mortality such as:

Mortality trends

Pandemics

Uncertainty

Social and demographic stratification

Analysis by cause of death

Graduation techniques

Projection techniques

Data availability and

Mortality related financial products

This material is captured in Task Force agendas and minutes, will be included on the IAA Mortality Task Force website and will be presented at seminars, colloquia and conferences. This is a de facto “process to enhance future efforts of actuaries in this area.” To propose how actuaries could take a leading role in international research on mortality by acting as the initiator and coordinator of such research. The Task Force’s proposal to achieve this goal is for the Task Force to become a permanent entity. This entity will assume the responsibility for initiating and coordinating mortality research.



Appendix B

Data Bases

SOA Table Manager Description: SOA Table Manager consists of (a) an Excel “Add in”, (b) a stand-alone program and (c) a data file containing mortality and persistency tables than can be accessed from either (a) or (b). Each table contains limited documentation, mortality tables can be either ultimate (1 dimensional) or select and ultimate (2 dimensional). New tables may be added by the user or by the SOA. Tables are subdivided by country and type, permitting users to narrow their searches. The Table Manager also permits comparison between tables. Tables loaded by the SOA become available to anyone downloading the Table Manager from the SOA web site. There is no charge for the Table Manager and the web site may be accessed by anyone. Advantages & Disadvantages of the SOA Table Manager Advantages • Cost: free • Accessibility: Internet access is only required to download the table, thereafter it can be

accessed at will by the user directly from their hard drive. • Format: Uniform table formats and internal ratio capabilities permit the user to compare

tables or download tables into text or Excel and perform more extensive analysis.

Disadvantages • Updating: the downloadable version of Table Manager is only updated when data is

provided to the SOA and updates may be delayed if SOA staff is unavailable to load new tables.

• Format: the Table Manager is restricted to formats envisioned and has not been updated to reflect newer technologies (e.g. Web 2.0). System compatibility issues may arise as new operating systems become available.



Human Mortality Data Base 1.1 Introduction The name of the data base described here is Human Mortality Data Base. It could be found at www.mortality.org. . It gives information on populationmortality in a number of countries. More information is given below. 1.2 Sponsor The Human Mortality Data Base is sponsored by the Department of Demography at the University of California, Berkeley, USA, and the Max Planck Institute for Demographic Research, Rostock, Germany. It also receives support from the National Institute of Aging. 1.3 Groups covered The Human Mortality Data Base covers population mortality for (at the moment) 37 countries, for as many years as reliable data is available. The oldest data is from 1751 from Sweden. 1.4 Selection features One could select data following gender and following Calendar year or year of birth 1.5 Information provided – quantitative Per Calendar year Number of births Number of deaths Population size Death rates (qx) Life tables Life expectancy at birth Per year of birth



Exposure to risk Death rates Life tables Life expectancy at birth Information could be presented with years, calendar years and/or years of age, grouped together in groups of 1, 5, or 10 years. 1.6 Information provided – qualitative The information included is collected from the local statistical bureaus in the different country and the quality follows the quality of those bureaus. This means that the quality is mainly high. For some countries, some qualitative comments are made. Detailed discussions of the quality of data could be found under “background and documentation” for each reported country. 1.7 Coverage The Human Mortality Data Base covers presently 37 countries. Work is done in order to increase this number. The countries and time periods are as follows: Country Time period covered Period of lower quality Australia 1921-2005 Austria 1947-2005 Belarus 1959-2007 1959-1969 Belgium 1841-1913, 1919-2006 Bulgaria 1947-2005 1947-1969 Canada 1921-2005 Chile 1992-2005 Czech republic 1950-2006 Denmark 1835-2007 England & Wales 1841-2006 Estonia 1959-2007 2001-2007 Finland 1878-2007 France 1816-2006 Germany 1991-2006 East Germany 1956-2006 West Germany 1956-2006 Hungary 1950-2005



Iceland 1838-2007 Ireland 1950-2006 1950-1985 Italy 1872-2006 1872-1905 Japan 1947-2006 Latvia 1959-2007 1959-1969 Lithuania 1959-2007 1959-1969 Luxembourg 1960-2006 Netherlands 1850-2006 New Zealand 1948-2003 Norway 1846-2007 Poland 1958-2006 Portugal 1940-2007 1940-1970 Russia 1959-2006 1959-1969 Scotland 1855-2006 1855-1875, war years Slovakia 1950-2006 1950-1961 Slovenia 1983-2006 Spain 1908-2006 1908-1960 Sweden 1749-2007 1751-1860 Switzerland 1876-2007 Taiwan 1970-2007 1970-1979 Ukraine 1959-2006 1959-1969 USA 1933-2005 More details on data quality etc are given for each country. New countries are added when good quality information is available 1.8 Tools for analysis No special analysis tools are available 2 Strengths and weaknesses 2.2 Strengths The data base has gone through a rather detailed data control. Information is given on how the information is collected. Generally the information could normally be trusted. 2.3 Weaknesses



Some older data is less reliable. Also some newer data is built on official information and is sometimes not better than the official information. One example: In Sweden there were many deaths in the South East Asia tsunami late 2004. In many of these cases, the body was not found or not identified in early January, where the official mortality statistics was compiled for Sweden for 2004. These deaths were therefore not included in the statistics. Also, when theses deaths were recognised in 2005, they were reported as having incurred 2004 why they were not included in the 2005 statistics either. But this is clearly discussed in the comments.



World Health Organisation

The mortality statistics are derived from annual reported death data in civil registration

systems in the various countries. The cause of death is defined as “the disease or injury

which initiated the train of morbid events leading directly to death, or the circumstances of

the accident or violence which produced the fatal injury”. This is done in accordance with

the rules of the International Classification of Diseases. This is an international standard

which is used to classify health problems and diseases for clinical purposes and on records

such as death certificates. Only countries which have data recorded according to these

definitions have been included in the tables.

However, there have been changes made from ICD9 to ICD10 and there are still countries

using the 9th revision. Several countries only changed the 10th revision recently. This may

have a significant impact on the data since the 10th revision is more detailed than the 9th

revision. ICD10 includes about 10 000 conditions for causes of death while ICD9 includes

about 5100.

There are considerable differences in completeness of the data submitted by different

countries. There may also be problems of the accuracy of the data in some countries with

incorrect or incomplete death certificates, misinterpretation of ICD and bias in diagnosis.

Some countries may only cover part of the country and in some not all deaths are recorded.

These countries with potential data accuracy problems are not listed on the website.

However, where only a part of the country is recorded, this will be indicated in the tables.

Where incomplete data was provided by countries, the WHO estimated the level of

completeness of the data.

Tables of coverage are also found on the website which could be a valuable tool in

assessing the completeness and accurateness of the mortality data. Coverage is defined as

the total deaths reported for a country-year divided by the total deaths estimated by WHO for

that year for the national population. There may also be differences in how countries report



data. For example some countries may record all deaths occurring in the specific country

while others will include deaths of residents abroad. A table was created for the purpose of

this study which indicates this coverage and groups the data into categories of high data

quality, medium data quality and poor quality. High quality is where the estimated coverage

is greater than 90% and the completeness is greater than 95%. Medium quality is where the

estimated coverage is greater than 80% and the completeness is greater than 90%. Poor

quality is anything less than this. These groupings were made with discretion given the

available data and more information is needed to make accurate groupings.

The countries which are deemed to have high quality data available are shown in Appendix

B.

Where incomplete data was provided by countries, the WHO estimated the level of

completeness of the data. The latest year of data availability is 2006 and only about 26

countries have data in respect of this year. Of this approximately only 17 is deemed as high

quality.

IAA Mortality Task ForceTallinn May 2009

CMI Tables ProgramBrian Ridsdale

UK Rep, Faculty and Institute of Actuaries

STPSTP – What is it?

The CMI Tables Program (STP) is a computer packagewhich includes all of the CMI tables of mortality and morbidityand mortality projections (including the interim cohort projections)published up to August 2006.

It costs £1,000 plus VAT

The STP is designed as a standalone system; it is not networkable

It is possible to incorporate STP tables into your own product

STPSTP - History

v 1.0 – January 1991Accompaniment to “80” Series tables – too many for printed volumes

v 2.0 – February 1994Income protection functions added

v 3.0 – July 1999“92” Series tables added, converted to Windows

v 3.1 – May 2003CMIWP1 (“Cohort”) projections added

v 3.2 – August 2006“00” Series tables added

v 3.3 – June 2009SAPS “S1” tables and Projections Library added

STPSTP – Mortality Tables

Historic tablesAssured Lives: A1924-29, A1949-52, A1967-70, FA1975-78Annuitants & Pensioners: a(55), a(90), PA(90)

Life Office Series“80” Series (1979-82)“92” Series (1991-94)“00” Series (1999-02)

Self-administered Pension Schemes SeriesSAPS “S1” Series (2000-06)

STPSTP – Functionality (1)

Mortality Functions

Commutation Functions

Single Life Monetary Functions

Assurances

Annuities

Premiums

STPSTP – Functionality (2)

Joint Life Monetary Functions

Assurances

Annuities

STPSTP – Features

Mortality adjustments: q’(x) = A.q(x+k)+BAIDS additions to mortalityMortality projections (CMI Library v1.1)Select / Ultimate mortality ratesChoice of interest rate(s)Single / Joint life functionsTable Editor allows user to input own tablesOutput can be saved in spreadsheet form

STPSTP – Income Protection

CMIR 12 formulaeCurrent claim annuitiesPricing functions

STPSTP – Further Information

http://www.actuaries.org.uk/knowledge/cmi/cmi_faqs/stp_faqs


CMI Tables ProgramBrian Ridsdale



CMI Library of Mortality ProjectionsBrian Ridsdale


CMI Library of Projections

The CMI Library of Mortality ProjectionsBackgroundDraftVersion 1Future plans (then)Version 1.1Source and useNext

CMI Library of Mortality Projections

MPWP established to explore possible projection methodologies for use with the “00” Series tablesResearch into P-spline and Lee-CarterIssues with both:

P-spline – vulnerable to edge effectsLee-Carter – basic L-C doesn’t fit UK data (cohort effects)

No projections in “00” Series tablesCMI recognised its research not accessible to many actuaries –> library

CMI Library of Mortality Projections Background

Draft issued in July 2007 with Working Paper 27Version 1.0 released in November 2007The library collated:

Existing projections (“92” Series, Cohort Projections, ONS)Variations on existing projections (e.g. cohort + minimum)Examples of P-spline and Lee-Carter projections

What was it hoped the “library” would achieve?Single source of “recognised” projectionsStandardisation of terminology for theseNOT intended to offer guidance on choice of projection

CMI Library of Mortality Projections Future Updates

No set times, updates for:New dataIntuitive scenariosNew methodologies

Indicative criteria in User Guide …new projections should be:

A worthwhile addition to the current libraryPublicly availableClearly described and documented ‘Road-tested’ on different datasets and for different time-periods; andAdequately exposed to the Actuarial Profession for discussion

CMI Library of Mortality Projections Version 1.1 of the Library

Issued in March 2009 with Working Paper 3715 additional projections:

PSAP, PSAC and Lee-CarterCMI data to 2006, ONS data to 2006 and 2007 (Male &

Female)

Working Paper illustrates impact of change in ONS practice (from date of occurrence to date of registration)

CMI Library of Mortality Projections Source and use

Library freely available:www.actuaries .org.ukSearch: Library of mortality projections

CMI Working Paper 27. Mortality projections library (zip file)

Supply your own data:alternatives …

CMI Library of Mortality Projections What’s next?


CMI Library of Mortality ProjectionsBrian Ridsdale


Page 7 of 9

Appendix A – List of countries with no data availab le

AfghanistanAlgeria MalawiAmerican Samoa MaliAndorra Marshall IslandsAngola MauritaniaAntarctica MayotteAscension Island Micronesia, Federated States OfBenin MontenegroBhutan MoroccoBolivia MozambiqueBotswana MyanmarBouvet Island NamibiaBurkina Faso NauruBurundi NepalCambodia New CaledoniaCameroon NigerCape Verde NigeriaCentral African Republic NiueChad Norfolk IslandChristmas Island Northern Mariana IslandsCocos (keeling) Islands PakistanComoros PalauCongo Palestinian Territory, OccupiedCongo, The Democratic Republic Of The PitcairnCook Islands RwandaCote D'ivoire Saint HelenaDjibouti SamoaEast Timor SenegalEquatorial Guinea Sierra LeoneEritrea Solomon IslandsEthiopia SomaliaFaroe Islands South Georgia And South Sandwich IslandsFrench Polynesia SudanFrench Southern Territories Svalbard And Jan MayenGabon SwazilandGambia TanzaniaGhana TibetGibraltar Timor-LesteGuam TogoGuinea TokelauGuinea-bissau TongaHeard Island And Mcdonald Islands TunisiaHoly See (vatican City State) TurkeyIndonesia TuvaluKenya UgandaKorea, Democratic People's Republic Of United Arab EmiratesLao People's Democratic Republic United States Minor Outlying IslandsLesotho VanuatuLiberia VietnamLibya Virgin Islands, BritishLiechtenstein Wallis And FutunaMacau Western SaharaMadagascar Zambia

Countries with no data

Page 8 of 9

Appendix B – Countries with high quality data avail able

Members

Latest

year

Estimated

coverage

Latest

year

Complet

eness

(%)

Data

quality

Argentina 2002-2005 100 2005 100 HighAustralia 2002-2003 100 2003 100 HighAustria 2002-2006 100 2006 100 HighBarbados 2000-2001 92 2001 100 HighBelarus 2002-2003 99.1 2003 100 HighBelgium 2002-2003 99.1 1997 100 HighBulgaria 2002-2004 100 2004 100 HighCanada 2002-2004 100 2004 100 HighChile 2002-2005 94.5 2005 100 HighCroatia 2002-2006 96.8 2006 100 HighCuba 2002-2005 100 2005 100 HighCyprus 1999-2000 97.4 2006 100 HighCzech Republic 2002-2005 100 2005 100 HighDenmark 1999-2001 100 2001 100 HighDominica 2002-2004 100 2004 100 HighEstonia 2002-2005 100 2005 100 HighFinland 2002-2006 100 2006 100 HighFrance 2002-2005 98.2 2005 100 HighGermany 2002-2006 100 2006 100 HighGreece 2002-2006 100 2006 100 HighGrenada 2002-2006 100 2002 100 HighHungary 2002-2005 100 2005 100 HighIceland 2002-2006 97.2 2006 100 HighIreland 2002-2006 99.3 2006 100 HighIsrael 2002-2004 100 2004 100 HighItaly 2002-2004 100 2003 100 HighJapan 2002-2006 100 2006 100 HighKuwait 1999-2002 100 2002 100 HighLatvia 2002-2006 95.2 2006 100 HighLithuania 2002-2006 97.2 2006 100 HighLuxembourg 2002-2005 100 2005 100 HighMalta 1999-2001 96.8 2005 100 HighMauritius 2002-2005 94.8 2005 100 HighMexico 2002-2005 95.4 2005 100 HighNetherlands 2002-2006 100 2006 100 HighNew Zealand 1999-2001 100 2004 100 HighNorway 2002-2005 100 2005 100 HighPoland 2002-2006 99.7 2006 100 HighPortugal 2002-2003 100 2003 100 HighRomania 2002-2006 100 2006 100 HighRussian Federation 2002-2006 100 2006 100 HighSaint Kitts and Nevis 2002-2005 100 2005 100 HighSaint Lucia 1999-2002 97.5 2002 100 HighSaint Vincent and Grenadines 2002-2003 92.2 2003 100 HighSeychelles 2001-2005 100 2005 100 HighSlovakia 2002-2005 98.5 2005 100 HighSlovenia 2002-2006 100 2006 100 HighSpain 2002-2005 100 2005 100 HighSweden 2002-2005 100 2005 100 HighSwitzerland 2002-2005 100 2005 100 HighUkraine 2002-2005 99.8 2005 100 HighUnited Kingdom 2002-2006 100 2006 100 HighUnited States of America 2002-2005 99.9 2005 100 HighUruguay 1999-2004 99.1 2004 100 HighVenezuela 2002-2005 100 2005 96 High

Coverage Completeness

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