Experience Analysis

Clarifying your financial future by maximising your data

Pension funds and life insurance companies make critical business decisions about how much to reserve, which assets to hold and what price to charge to its customers based on historical analysis of its insured population. While pension funds and insurers have complex models to determine how to price and value risk, these models are fundamentally based on a view of future life expectancy of its population that often assumes the profile of their members life expectancy is no different from the average expectancies of a country’s population.

In reality, each pension fund has its own population with its own unique social, economic and individual characteristics. Without consideration for these features, pension funds run the risk of making the wrong decisions about which assets to invest in and ultimately might not have enough capital to cover members benefits.

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How we help

PwC has developed an Experience Analysis tool that allows pension funds and insurance companies to:

better understand the key drivers in their underlying population;
through highlighting the value in your data, its credibility, and how it compares with the market; and
allow you to better evaluate the risks in your fund.

How we do it

Our Experience Analysis solution combines the latest visualisation software and propriety actuarial algorithms to quantify the impact of key factors on your members benefits. The solution visualises how the experience will evolve and where you have different features from the market. You can explore how the business will develop in the future and what strategies you might want to employ.

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“Our approach, with its frequent monitoring, can react to the changing demographics of an insured population. With greater visibility to the drivers and the data, the solution gives you more confidence in your assumptions and trust in the decisions you have made.”

James Norman, Actuarial Services Leader, PwC Switzerland

How you can benefit

Our software, combined with PwC’s market experience, provides you with the confidence to trust your business assumptions and know that they are reliable and reflect the underlying data. Benefits include:

Knowledge of how your cover ratio will evolve over time to help you decide what actions to take to ensure that the assets are sufficient; and
Understanding how to set neutral conversion rates to ensure members are fairly and properly treated.

Other features allow you to evaluate reinsurance rates and optimise your reinsurance strategies. These features and results of the findings are provided through live presentations by our expert actuaries using a real time reporting dashboard that can benchmark your insured portfolio against other market participants.