Longevity Risk 2nd Edition

Emma McWilliam returns with the highly anticipated, and fully updated, second edition of Longevity Risk. McWilliam, alongside two new co-editors and Hymans colleagues Howie Timothy and Matt Thomas, has assembled a roster of leading experts in the field of longevity.

Managing longevity risk (LR) requires an understanding of a wide range of issues, from the measurement of LR for pricing, reserving and setting aside capital, to the management of risk through de-risking, reinsurance and capital markets solutions. These diverse topics are assiduously explored in this text by longevity thought-leaders and practitioners, whose extensive experience cuts across disciplines, from (re)insurance to capital markets, from law to medicine and academia, as well as across the major longevity markets globally.

The book is divided into 5 Parts:

I. Setting the Scene: Appreciating the big leaps forward around the world made over the last century, enabling the reader to understand the evolution of LR.

II. Measurement of Longevity Risk: In assessing LR, consideration is given to key attributes such as data sources, statistical techniques, application of credit theory, future mortality projections and measuring uncertainty.

III. Longevity Risk Management: De-risking options for pension schemes, insurance companies, and reinsurance are defined and explored. As are how to limit counterparty credit risk exposures, commercial aspects of reinsurance and hedging.

IV. Capital Markets and Wider Considerations: The alternative end route to de-risking is looked at in detail. Key capital market transactions, the role of longevity indices, the role of governments and legal considerations of cross-market deals are all dealt with.

V. Spotlight on International Longevity Markets: Global growth in LR transfer markets has rapidly developed. The final part of this book shines a light on the three countries leading that growth: Canada, the Netherlands and the United States.

As LR evolves, so does the sophistication of the tools with which we measure and manage the risk. It is the aim of this book to inform the reader and arm them with the knowledge to develop robust and innovative solutions, enabling the effective management of longevity risk, for the long-term benefit of future generations.