Prioritise deferred lifetime annuities: Actuaries Institute

18 February 2014
| By Kate Cowling |
image
image
expand image

Deferred lifetime annuities must be placed high on the new Government’s agenda if it wants to lessen the impact of longevity risk, the Actuaries Institute believes.  

In a pre-Budget submission, the professional body called on the Federal Government to open the door for product innovation by removing barriers in the longevity risk space.   

“The current limited range of income products that pool longevity risk, including the unavailability of pure longevity protection in the form of a deferred lifetime annuity (DLA) and other guaranteed retirement income products, is a major consumer issue for the growing number of baby boomers who are retiring each year,” the submission said.   

It also called for the Government to incentivise income stream superannuation products to reduce the likelihood of retirees running out of lump sum super and using the pension as a fallback.   

“In particular, retirees should be incentivised to protect themselves against their own longevity,” it said.   

As a further measure, the institute said the pension age should be further lifted in line with rises in life expectancy.   

In addition, legislative barriers preventing older Australians from staying in the workforce should be removed, it said. 

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest developments in Super Review! Anytime, Anywhere!

Grant Banner

From my perspective, 40- 50% of people are likely going to be deeply unhappy about how long they actually live. ...

10 months 1 week ago
Kevin Gorman

Super director remuneration ...

10 months 2 weeks ago
Anthony Asher

No doubt true, but most of it is still because over 45’s have been upgrading their houses with 30 year mortgages. Money ...

10 months 2 weeks ago

The profit-to-member super funds are officially operating as a merged entity, set to serve over half a million members. ...

1 day 15 hours ago

Super Review announced 21 winners at the annual Super Fund of the Year Awards, including the recipient of the prestigious Fund of the Year Award....

2 days 6 hours ago

APRA data shows the CFMEU accounted for 28 per cent of super fund industrial contributions, with the shadow treasurer calling for a prompt investigation into the payments...

3 days 10 hours ago