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Longevity Risk Management in Singapore's National Pension System
Author(s) -
Fong Joelle H. Y.,
Mitchell Olivia S.,
Koh Benedict S. K.
Publication year - 2011
Publication title -
journal of risk and insurance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.055
H-Index - 63
eISSN - 1539-6975
pISSN - 0022-4367
DOI - 10.1111/j.1539-6975.2010.01401.x
Subject(s) - annuity , pension , mandate , life annuity , longevity risk , business , government (linguistics) , actuarial science , longevity , economics , finance , linguistics , philosophy , political science , law , biology , genetics
Abstract Although annuities are a theoretically appealing way to manage longevity risk, in the real world relatively few consumers purchase them at retirement. To counteract the possibility of retirees outliving their assets, Singapore's Central Provident Fund, a national defined contribution pension scheme, has recently mandated annuitization of workers’ retirement assets. More significantly, the government has entered the insurance market as a public‐sector provider for such annuities. This article evaluates the money's worth of life annuities and discusses the impact of the government mandate and its role as an annuity provider on the insurance market.