RMS

Overview: Science

Understand
the Causes of Mortality Change

1950

15
Centenarians per Million population
68years
Life expectancy
at birth

1990

78
Centenarians per Million population
76years
Life expectancy
at birth

2010

210
Centenarians per Million population
79years
Life expectancy
at birth

2030

High 3,500
Medium 1,000
Low 515 Centenarians per
Million population

A Changing Picture of Mortality

Life expectancy change affects liabilities and financial cash flow. A key indicator of the dramatic change in life expectancy is the growth of people aged over 100 in our society. This generation is benefiting from the greatest advance of medical science in history.

Social Changes in 1950
- Lifestyle: European post-war austerity; Two thirds of adults smoke; smoking link to cancer proved in 1954.
- Medical Advances: discovery of structure of DNA. Penicillin in mass production.
- Health Economics: Healthcare insurance offered by US employers for first time. Universal health services set up in Europe.
- Mortality Shocks: Asian Flu pandemic 1957/8 kills up to 4m people worldwide.
Social Changes in 1990
- Lifestyle: Tobacco companies settle law suit for $206 Billion; Tobacco advertising banned; Food calorie labeling.
- Medical Advances: clinical trials prove statins cut heart deaths; 5% of adults are taking statins by 1998; heart attack mortality rate 80%.
- Health Economics: Healthcare expenditure averages $2000 per person; Consolidation of drug industry into giant pharmaceutical companies.
- Mortality Shocks: HIV/AIDS emerges in 1980s, reaching 8m cases by 1990.
Social Changes in 2010
- Lifestyle Changes: A quarter of the adult population smokes; Smoking bans in many countries.
- Medical Advances: Lipitor becomes world's best selling drug with annual sales of $13 Bn; Stem cell transplants; heart attack mortality rate 40%.
- Health Economics: Health expenditure averages $3,000 per person - 9% of GDP.
- Mortality Shocks: SARS emerges as a new infectious disease 2002.
  
  Terrorist attack 2001 kills 3000 and causes largest ever life insurance loss.
  
  Avian flu outbreaks from 2006 puts world on pandemic alert.
What If?
- Lifestyle: Nobody smokes. Obesity wave is halted; Fitness levels become much higher than today.
- Medical Advances: Cancer becomes a managed disease.
- Health Economics: 20% of GDP spent on healthcare; focus shifts to preventative medicine.
- Regenerative medicine: Stem cell treatments repair heart damage; Nanomedicine provides benefits.
- Retardation of aging: Clinical trials begin for an anti-aging drug.
- Mortality Shocks: A pandemic occurs causing high mortality in the elderly.

Understanding
Shock and Trend Risk

Expected mortality in a life or pension portfolio is derived from detailed analysis of historical mortality experience and past population trends. A holistic assessment of liability risk includes the shock risk of increased mortality through excess mortality events, and the longevity trend risk of extreme scenarios of reduced mortality from drivers of mortality improvement.

Excess Mortality

Recent mortality experience does not capture the full potential for future extreme shocks

28 years Average interval between
influenza pandemics

Longevity

The last 20 years have seen unprecedented mortality improvement. Why?

65 year olds are currently gaining a year of life expectancy every four years

Catastrophe Perils
Vitagions

Catastrophe Perils

The Causes of Excess Mortality Risk

Tail volatility for mortality is driven by extreme events that arise from specific causes. A deep understanding of each life catastrophe peril enables a complete assessment of the future frequency and severity of outcomes for a specific insured portfolio. The science provides insights for developing insured portfolios that are resilient to shock.

Pandemic Influenza

The influenza virus is one of the fastest mutating pathogens. Genetic shifts that evade human defenses cause global pandemics.
Emerging Infectious Diseases

At least once a decade a new disease evolves that medical science has no treatment for.
Mass-Casualty Terrorism

Modern terrorists threaten mass casualty attacks using weapons of mass destruction, particularly posing group life concentration risks.
Natural Hazards

Earthquakes, floods, and other natural hazards can kill tens of thousands of people, even in the developed world.
Other Causes

Industrial and transport accidents, extreme weather, and other events drive additional mortality volatility.

Vitagions

The Causes of Longevity Risk

Mortality improvement is driven by a combination of social, economic and medical factors. Detailed analysis of each of the causes of improvement provides an explanation of recent trends and provides a framework for examining the potential for extreme future improvements. Unexpectedly large improvements that pose a threat to financial viability arise from extreme trajectories of a vitagion category or combinations of several.

Lifestyle Trends

Personal decisions like smoking habits, diet and exercise have strong influence on mortality levels.
Medical Intervention

New medical treatments, drugs, and advances in bio-technology bring about extensions in life expectancy.
Health Environment

The availability of healthcare and public health standards control the living conditions that determine mortality.
Regenerative Medicine

New technologies such as stem cell therapy and nanomedicine promise future mortality improvements .
Retardation of Aging

Research into radical new approaches of extending healthy life may impact mortality levels some time in the future.

Tapping the Wealth of Science

RMS provides a framework for integrating multidisciplinary science into mortality risk management.

The wealth of knowledge that is being created by scientific study around the world can be assimilated into life insurance business decisions.

5Million
New medical scientific
publications a year
3Thousand
New drugs undergoing
trials for FDA approval
250Thousand
Medical scientists in
United States and Europe
$160Billion
Spent on medical
science a year worldwide

RMS(one)

Models

Overview

Solutions

Resources

News

About RMS

Careers @ RMS

Overview: Science

Understand
the Causes of Mortality Change

1950

1990

2010

2030

A Changing Picture of Mortality

Understanding
Shock and Trend Risk

Excess Mortality

Longevity

Catastrophe Perils

The Causes of Excess Mortality Risk

Pandemic Influenza

Emerging Infectious Diseases

Mass-Casualty Terrorism

Natural Hazards

Other Causes

Vitagions

The Causes of Longevity Risk

Lifestyle Trends

Medical Intervention

Health Environment

Regenerative Medicine

Retardation of Aging

Tapping the Wealth of Science

Overview: Science

Understand the Causes of Mortality Change

1950

1990

2010

2030

A Changing Picture of Mortality

Social Changes in 1950

Social Changes in 1990

Social Changes in 2010

What If?

Understanding Shock and Trend Risk

Excess Mortality

Longevity

Catastrophe Perils

The Causes of Excess Mortality Risk

Pandemic Influenza

Emerging Infectious Diseases

Mass-Casualty Terrorism

Natural Hazards

Other Causes

Vitagions

The Causes of Longevity Risk

Lifestyle Trends

Medical Intervention

Health Environment

Regenerative Medicine

Retardation of Aging

Tapping the Wealth of Science

Understand
the Causes of Mortality Change

Understanding
Shock and Trend Risk