Translating epidemiological evidence on social inequalities to support the pensions industry

UCL's first-ever analysis of inequalities in mortality trends by cause of death over 25 years in England, and future projections of these, resulted in better informed pricing and risk management practices at Legal & General and helped strengthen the evidence base for assumptions of mortality improvements for UK financial regulators.

Population ageing is a key social issue of our times. Not only do we need to understand the factors which have contributed to increasing longevity and how these may evolve; we also need to understand patterns of social inequalities in health to inform policymaking.

Since 2006, researchers at the UCL Institute of Epidemiology and Health Care have led a programme funded by Legal & General (L&G), one of Britain's top FTSE 100 companies and a major pension provider in the UK insurance industry. The programme was set up to apply UCL's expertise in the field of social epidemiology to key questions underpinning mortality and longevity risk which are of interest to the UK actuarial profession. The overarching aims are: to analyse social inequalities in health and mortality risk in older age, between groups and over time; to identify the underlying drivers of longevity change; and to project future trends.

The principal investigators for this collaboration are Joseph Lu at L&G and Professor Rosalind Raine at UCL. Dr Madhavi Bajekal and Dr Shaun Scholes (both L&G employees and honorary staff at UCL) are the lead researchers.

The research has implications for the valuation of pensions across social groups at L&G. UCL supports L&G to translate published epidemiological evidence to meet their specific information needs in a practical way. L&G also had the opportunity to hear discussions on the changing needs, and matters relating to the provision, of healthcare in the UK - especially in relation to major chronic diseases now and in the future. More generally, UCL researchers disseminated their findings across the industry by publishing in discipline-relevant media, and presenting at industry forums, such as articles in the premier trade journal 'The Actuary'.

The UCL research fills the gap in public availability of socially segmented longevity risk analyses, including their epidemiological drivers via the medium of peer-reviewed publications, the pension industry has an externally acknowledged benchmark against which to align company specific client portfolios and to project future trajectories based on a better understanding of the reasons for past differentials and the likely direction of travel.

The research also has a wider impact on social and health policy - for example, it has been used by the Office of National Statistics in their Statistical Bulletin on Avoidable Mortality in England and Wales (2011). A key outcome of this collaboration was to achieve a collective view on the future evolution of health and longevity, thus spurring the development of a range of insurance and annuity products that are fair, affordable and could improve the quality of life of all in retirement.