Defined terms for the annuity market and lifetime income landscape.
The socioeconomic mortality gradient is the consistent empirical finding across developed populations that individuals at higher socioeconomic positions live longer than those at lower positions, with the difference in US life expectancy roughly 10–15 years between top and bottom deciles.
The solidarity principle is the normative position that members of a lifetime income pool accept some cross-subsidy among different risk classes in exchange for the broader benefits of pooling, distinguishing pooled arrangements from those that price each member at individual actuarial value.
Solo drawdown is self-managed drawdown of savings to a chosen planning age, with no remaining value past the planning age, used as the baseline against which pooled and insured lifetime income arrangements are evaluated.
A split annuity is an arrangement in which an individual allocates capital across two annuities at the same time — typically an immediate annuity paying current income and a deferred annuity accumulating for future use — to produce defined income now while preserving growth for later.
