Steady improvements in American life expectancy have stalled, and more Americans are dying at younger ages. But for companies straining under the burden of their pension obligations, the distressing trend could have a grim upside: If people don’t end up living as long as they were projected to just a few years ago, their employers ultimately won’t have to pay them as much in pension and other lifelong retirement benefits.
In 2015, the American death rate—the age-adjusted share of Americans dying—rose slightly for the first time since 1999. And over the last two years, at least 12 large companies, from Verizon to General Motors, have said recent slips in mortality improvement have led them to reduce their estimates for how much they could owe retirees by upward of a combined $9.7 billion, according to a Bloomberg analysis of company filings. “Revised assumptions indicating a shortened longevity,” for instance, led Lockheed Martin to adjust its estimated retirement obligations downward by a total of about $1.6 billion for 2015 and 2016, it said in its most recent annual report.
Main reason being heroin and opiate overdose deaths facilitated by big pharma and the good folks in the US armed forces, keeping that Afghan opium supply safe from religious fanatics for 15 years and counting!
if rates rise, which it very likely will, it’ll be a lot better for db plans (assuming they short duration). expected return goes up so the projected assets goes up. discounting rate rises, which lowers the liability. hopefully that’ll bring it to surplus.
also we’d fix the project budget deficits if people die sooner. so not necessarily a bad thing to die when you are no longer productive.
Deaths from unintentional injuries, including drug overdoses, are also up, rising by 10,000 since 2014. While the epidemic of heroin and prescription-painkiller abuse accounts for some of that, experts say it doesn’t explain the full picture.
“If it was all about opioids, we might focus our efforts on [that issue],” said Ellen Meara, a professor at the Dartmouth Institute for Health Policy and Clinical Practice. “But we see that strokes, heart disease, and chronic lower respiratory disease deaths are rising as well, suggesting the problem is even more widespread than we thought.”
Much of the increase in mortality can be explained by obesity. In 2015, weight problems accounted for more than 10 percent of all American deaths, according to Christopher Murray, director of the Institute for Health Metrics and Evaluation at the University of Washington
Increased number of deaths in every category except cancer. Largest contributions from Alzheimer’s followed by unintentional injuries. Americans are becoming more accident prone. Maybe unintentional injuries up because of people typing on their phones while walking down the street…