New mortality tables for public-sector pension plans could be coming, following an exposure draft released for public comment Tuesday by the Society of Actuaries.
The SOA has updated mortality tables for private-sector pension plans, and this is the first effort to do so for public plans. SOA officials are soliciting feedback on the exposure draft until Oct. 31, which they will assess before considering final tables.
Takeaways from the exposure draft include the finding that higher income is correlated with lower mortality, with income being a more statistically significant mortality factor than job category, geographic region or calendar year. In the private sector, income is also a separator of mortality rates, but the difference is more blue collar vs. white collar.
The public-sector tables also show that pension obligations for teachers are higher than other job categories, when other factors are equal. Female teachers reaching age 65 have a life expectancy of 90 or above. "It shows the good mortality in that subgroup and ongoing mortality improvement," said R. Dale Hall, SOA managing director of research, in an interview.
Updating mortality tables "is consistent with our goal at SOA to help plan sponsors and their actuaries set actuarial assumptions," said Mr. Hall, who added that plan sponsors and their actuaries could refine them even further for their specific plans.
With 78 plans in 35 different systems contributing data, "it's a very, very robust study. … It helps give a very good picture for these jobs," Mr. Hall said. But he stressed that "every plan is different. It has its own nuances, mortality studies, health and wellness benefits. That's where it is helpful for the plan sponsor and actuary to survey their own plans. (The SOA report) "is just a tool for plan sponsors and actuaries to use."
"We think this is a helpful step to help people make decisions," Mr. Hall added.