Projecting Future Mortality

Bridget Browne and Nicholas Owen

The early chapters in this book put forward the notion that mortality is continuously evolving. Over time the drivers of these changes have come to be better understood. This chapter turns to the challenge of predicting the future evolution of mortality rates. Forecasts of future mortality are used for a range of purposes, eg, by governments or demographers to project the future makeup of a population, and by financial institutions to adequately set reserves and pricing for long-term pension obligations.

The task of forecasting effectively moves from establishing the best possible picture of mortality as it stands at a given point in time into predicting the future. But it does not stop there. Special care must be taken to explain to the intended audience the associated uncertainty of any future projections in the context of their end use.

The lack of a recommended common view on the projection of future mortality means that any projection of future changes is subject to much debate, and expert opinions often differ. The difficulty in making projections is furthermore muddied by substantial changes in past mortality and by changes in the recording of data such as the

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