Ultimate Mortality Table

What is ‘Ultimate Mortality Table’

A mortality table that lists the death rates of insured persons of each sex and age group and excludes data from policies that have been recently underwritten. An ultimate mortality table also lists the proportion of individual survival from birth to any given age. Insurance companies use these tables to price insurance products and ultimately the profitability of these insurance companies depend upon correct analysis of the table.

Explaining ‘Ultimate Mortality Table’

By removing the first few years of life insurance data from the table, the ultimate mortality table more accurately shows the rate of mortality after removing selection effects. People who just received life insurance will have usually just had a medical exam and are relatively healthy and so this table attempts to remove that effect.

The calculation of an ultimate mortality table affects insurance requirement reserves and proper pricing by insurance companies. Along with death and survival rates amongst age groups and sexes, mortality tables can also list survival and death rates in relation to weight, ethnicity and region.

Further Reading

  • Financial innovation for an aging world – www.nber.org [PDF]
  • Bootstrapping parametric models of mortality – www.tandfonline.com [PDF]
  • 80 will be the new 70: Old‐age mortality postponement in the United States and its likely effect on the finances of the OASI program – onlinelibrary.wiley.com [PDF]
  • Modelling and management of mortality risk: a review – www.tandfonline.com [PDF]
  • Potential early phase success and ultimate failure of economic sanctions: A VAR approach with an application to Iran – journals.sagepub.com [PDF]
  • Impact of performance‐based financing in a low‐resource setting: a decade of experience in Cambodia – onlinelibrary.wiley.com [PDF]
  • The double emergence of the modified internal rate of return: The neglected financial work of Duvillard (1755–1832) in a comparative perspective – www.tandfonline.com [PDF]
  • Global estimates of the burden of injury and illness at work in 2012 – www.tandfonline.com [PDF]
  • End-stage renal disease and economic incentives: the International Study of Health Care Organization and Financing (ISHCOF) – link.springer.com [PDF]