Defined benefit (DB) pension scheme trustees will face increased scrutiny if their mortality assumptions appear weaker than the long cohort assumption under a consultation published by the Pensions Regulator today.
The regulator also proposes trustees will attract further scrutiny if their mortality assumptions include an improvement rate tending towards zero and they have no form of underpin. Tony Hobman, chief executive of the Pensions Regulator, says: "It is the regulator's view that some projections that have been in common use can no longer be considered reasonable assumptions. "We wish to bring these developments to the attention of trustees and outline how they should go about deciding on funding assumptions for defined benefit schemes. "Scheme members living longer adds to the cost of pens...
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