Briefs

The brief’s key findings are:

• “Longevity bonds” would allow insurers and pension plans to hedge aggregate longevity risk.

• The bonds’ coupon would rise if a cohort lived longer than expected, offsetting higher annuity costs.

• Longevity bonds would lower capital requirements for insurers and reduce risk for pension plan sponsors.

• Governments could take the lead in issuing such bonds and gradually shift most of the responsibility to the capital markets.