設(shè)計(jì)消費(fèi)者需要的年金產(chǎn)品2

DesigningannuityproductsforconsumersneedsPresentedbyMikeWadsworth

Partner,WatsonWyattMay2003 AgendaOptionsforgeneratinglifetimeincomeConsumerneedsInvestingforlifeManagingsurvivalAnewmodel"Idon'twanttoachieveimmortalitythroughmywork-Iwanttoachieveitbynotdying"WoodyAllen"Peoplewillsoonlivetwiceaslongastoday,andhavethepotentialtolivefor1200years"JohnHarris,ScientistMemberofUKHumanGeneticsCommissionasreportedSundayTimes,25June2000Funeralfirmhitby29%profitfallNotenoughpeoplearedyingintheUS,accordingtoServiceCorporationInternational,theworld'slargestfuneralservicescompanyTimes,2October1999Scaleofopportunities

Peopleover65Source:USBureauoftheCensusAnnuityversusbondyieldIncometakenmonthlyinadvance;interestrate5%paAnnuityincomebrokendownintocapitalelementandthebalance(ieinterestelement)Optionsforretirementincome100%PensionerInvestmentGuaranteesPensioner

Survival

GuaranteesTraditionalAnnuityLump

Sum??WatsonWyattPartners2000

0%0%Traditionalannuities

SomeimportantquestionsHowmuchdotheguaranteescost?Howvaluablearetheytocustomers?earlyinretirement/laterinretirement?accordingtootherassets?Howwilllifestylesandneedschangeinretirement?Willcustomerschangetheirmindsovertime?Keyissuesfordesign

ThePensionerChoice(investment)Flexibility(income)Protection(survival)Communication(tradeoffs)FailsafeAlifetimeassetallocationmodelTraditionalEitherlumpsumOrannuityRetireRetireOptimumreturn(equities?)Optimumreturn(equities?)CashBondsBonds?WatsonWyattPartners2000AlifetimeassetallocationmodelProposedOptimumreturn(equities?)Optimumreturn(equities?)BondsRetire?WatsonWyattPartners2000Effectofinvestmentgrowthonsupportableincome-malesBaseincomesupportablecalculatedat5%.Incomemultiple=incomesupportableassumingextrainvestmentreturnresultingfromequityinvestmentof1,2,3,4or5%paaftercharges,dividedbybaseincome.Mortalityaspreviously?WatsonWyattPartners2000PlanningretirementincomeTheconsumerproblemis.....HowlongwillIlive?LifespanisadistributionnotanexpectationDistributionofdeathsRetirementatage60Mortality:PMA92/PFA92Yearofuse2001?WatsonWyattPartners2000DistributionofdeathsbyagenowAge75now?WatsonWyattPartners2000Mortality:PMA92/PFA92Yearofuse2001DistributionofdeathsbyagenowAge90now?WatsonWyattPartners2000Mortality:PMA92/PFA92Yearofuse2001Standarddeviationofdeaths,asaproportionoflifeexpectancyMortality:PMA92/PFA92Yearofuse2001?WatsonWyattPartners2000MethodofcalculationNon-annuitisedfundIncomeeachyeardefinedas:Fundvalue/annuityfactorAnnuityfactorcalculatedatassumedinvestmentreturnof0%or7%pa(excludingexpenses)Investmentreturnachievedequalto7%pa(excludingexpenses)Investmentreturnassumed:(exclexpenses)Investmentreturnachieved:7%pa(exclexpenses)Mortality:PMA92Yearofuse2001Initialfund￡100,000Maleaged60atoutset?WatsonWyattPartners2000Progressionofincome:spreadingfundoverfuturelifeexpectationProgressionofincome-annuitisedfundversusnon-annuitisedfundMortality:PMA92Yearofuse2001Maleaged60atoutset?WatsonWyattPartners2000SupplierviewofmortalityguaranteesMortalityimprovingHowfast1%pa?2%pa?3%pa?Infuture?Scopetoreview?Guaranteesare(too)expensive?Mortalitydrift-uncertainfutureimprovementsBothchartsshowexpecteddistributionofdeathsformaleaged60in1992,allowingforfutureimprovements.PMA92representsthemorerecentestimateCross-subsidyoperatesacrosseitherdistribution,andlongevityprotectionislargelyretainedevenifmortalityisreviewedDriftinanticipateddistributionallowingfornewerevidence?WatsonWyattPartners2000Excesssurvivors-PMA92comparedwithPMA80Costtoannuityproviderofnotreviewingmortalityrelatestopaymentsmadetothosesurvivorswhowerenotexpectedtolivesolong-theredzone?WatsonWyattPartners2000NewmodelInvestmentfund+InsuranceagainstsurvivalLifetimeincomemodel-benefitstatementUnitsUnitPriceValue￡￡￡￡StartofYear10,00010.00100,000AnnuityPayments(975)(10,000)SurvivalBonus2953,000EffectofChangesinUnitPrice4,860EndofYear9,32010.5097,860TargetIncomeforNextYear10,000?WatsonWyattPartners2000Equivalentadditionalfundgrowthresultingfrommortalitycross-subsidyMortality:PMA92/PFA92CalendarYear2001?WatsonWyattPartners2000EquivalentadditionalfundgrowthMF%pa%paNB:PartialsurvivalprotectionpossibleFlexibleannuityreviewcycleInitialmax/minincomecalc'dAnnuitantselectsincomebetweenmaxandmintonextreviewPaymentsdeductedaccordingtoannuitantrequirements/survivalcredits/investmentreturnsaddedFundbalancedeterminedatreviewMax/minincometonextreviewcalc'd?WatsonWyattPartners2000FlexibleincomeThecorridorIncomelevelchosenbytheannuitantannualmaximumannualminimum?WatsonWyattPartners2001CommunicationofbenefitsIncomeprojections-incometakeninitially=incomesupportableat7%pa?WatsonWyattPartners2000Incomeprojections-incometakeninitially=1.1xincomesupportableat7%pa?WatsonWyattPartners2000Incomeprojections-incometakeninitially=0.9xincomesupportableat7%pa?WatsonWyattPartners2000Incomeprojections-variableinvestmentmodel?WatsonWyattPartners2000FailsafeDefaultinvestmentstrategies,egequitiesbondsoverlifetimeProgrammedswitchingtoguaranteeathighageProgrammedswitchingtoguaranteeonsustainedmarketfall,egJapanscenarioVoluntaryswitchingNB:MorefeaturesbettersystemsAnnuitydevelopments-unbundlingdynamicMoreimpairedlife/enhancedannuitiesOtherg'teedannuitiesmoreexpensive/lessprofitableMoreequitybasedannuitiesWeakerlongevityguarantees?WatsonWyattPartners2002EffectofLTCrideronincomeBeforeLTCclaimAfterLTCclaimTheproductisavariableannuitypriortoclaim,thenafixedLTCannuityafterclaim,plusacontinuingvariableannuity(whichcouldconverttoaconventionalannuity).Thelevelofbenefitischosenbytheinsured.C

LA

IMIncomesupportablewithnoLTCrider(normalincome)LTCincome=50%ofincomepre-claimIncome=~96.5%ofnormalLTCincome=100%ofincomepre-claim

Income=~92.5%ofnormalAdvantagesoflifetimeincomemodelPensionersnaturalextensiontoDCpensionvehiclechooseandvaryassetallocationflexibilityofincomeoptimiseincomerelativetoriskInsurers/fundmanagerslongevityriskmanageablepotentialsegmentationofrisksnotrestrictedbyavailablebond(orother)investmentsglobalmultimarketapplicationAlsofinancialplanners/bondsuppliersDesigningannuityproductsforconsumerneedsPresentedbyMikeWadsworth

Partner,WatsonWyattMay20029、靜夜四四無(wú)鄰，，荒居舊舊業(yè)貧。。。12月-2212月-22Saturday,December31,202210、雨中黃黃葉樹(shù)，，燈下白白頭人。。。14:55:5814:55:5814:5512/31/20222:55:58PM11、以我獨(dú)沈沈久，愧君君相見(jiàn)頻。。。12月-2214:55:5814:55Dec-2231-Dec-2212、故人江海海別，幾度度隔山川。。。14:55:5814:55:5814:55Saturday,December31,202213、乍見(jiàn)翻疑夢(mèng)夢(mèng)，相悲各問(wèn)問(wèn)年。。12月-2212月-2214:55:5814:55:58December31,202214、他鄉(xiāng)生白發(fā)發(fā)，舊國(guó)見(jiàn)青青山。。31十二月月20222:55:58下午14:55:5812月-2215、比不不了得得就不不比，，得不不到的的就不不要。。。。十二月月222:55下下午午12月月-2214:55December31,202216、行行動(dòng)動(dòng)出出成成果果，，工工作作出出財(cái)財(cái)富富。。。。2022/12/3114:55:5814:55:5831December202217、做做前前，，能能夠夠環(huán)環(huán)視視四四周周；；做做時(shí)時(shí)，，你你只只能能或或者者最最好好沿沿著著以以腳腳為為起起點(diǎn)點(diǎn)的的射射線線向向前前。。。。2:55:58下下午午2:55下下午午14:55:5812月月-229、沒(méi)有失失敗，只只有暫時(shí)時(shí)停止成成功！。。12月-2212月-22Saturday,December31,202210、很多事事情努力力了未必必有結(jié)果果，但是是不努力力卻什么么改變也也沒(méi)有。。。14:55:5814:55:5814:5512/31/20222:55:58PM11、成功就是日日復(fù)一日那一一點(diǎn)點(diǎn)小小努努力的積累。。。12月-2214:55:5814:55Dec-2231-Dec-2212、世間成事事，不求其其絕對(duì)圓滿滿，留一份份不足，可可得無(wú)限完完美。。14:55:5814:55:5914:55Saturday,December31,202213、不不知知香香積積寺寺，，數(shù)數(shù)里里入入云云峰峰。。。。12月月-2212月月-2214:55:5914:55:59December31,202214、意意志志堅(jiān)堅(jiān)強(qiáng)強(qiáng)的的人人能能把把世世界界放放在在手手中中像像泥泥塊塊一一樣樣任任意意揉揉捏捏。。31十十二二月月20222:55:59下下午午14:55:5912月月-2215、楚塞三三湘接，，荊門(mén)九九派通。。。。十二月222:55下午午12月-2214:55December31,202216、少年年十五五二十十時(shí)，，步行行奪得得胡馬馬騎。。。2022/12/3114:55:5914:55:5931December202217、空山新新雨后，，天氣晚晚來(lái)秋。。。2:55:59下午午2:55下午午14:55:5912月-229、楊柳散和和風(fēng)，青山山澹吾慮。。。12月-2212月-22Saturday,December31,202210、閱讀一切好好書(shū)如同和過(guò)過(guò)去最杰出的的人談話。14:55:5914:55:5914:5512/31/20222:55:59PM11、越是沒(méi)沒(méi)有本領(lǐng)領(lǐng)的