Defined terms for the annuity market and lifetime income landscape.
A longevity pool is a risk-pooling arrangement specifically organized around the uncertainty of how long its members will live, in which the share of pool resources released by member deaths is redistributed to surviving members as lifetime income.
Longevity risk is the risk that an individual or a population will live longer than expected, with consequences for the adequacy of lifetime income, the reserves of insurers, and the funding of pension and social-insurance arrangements.
A longevity risk-sharing pool is an arrangement in which multiple individuals contribute to a common fund and receive lifetime income, with mortality experience shared across the group so that survivors' income is supported by amounts released from participants who die before their expected age.
Risk transfer is the mechanism by which longevity risk is shifted from the individual to a counterparty in exchange for a fee, applied to transferred-risk and hybrid lifetime income arrangements. Why it matters Naming the risk-sharing property of a claim with the value transferred or hybrid identifies that longevity risk does not stay with the participant — but it does not by itself describe how the shift happens. Risk transfer names the mechanism. The mechanism has structural con
