08 January 2008
Some of the UK's largest life assurers are expected to announce
measures to shore up their reserves to take account of much longer
life expectancy among people who buy annuities.
This follows concerns from the Financial Services Authority
(FSA) that assurers are ignoring mounting evidence that even
conservative longevity assumptions are insufficient. Annuity
policies in the UK total an estimated £100bn, meaning that
just one additional year on life expectancy could require companies
to increase their reserves by £3bn - £4bn.
