Forecasting Spanish Natural Life Expectancy

In: Risk analysis: an international journal, Band 25, Heft 5, S. 1161-1170

Abstract

Knowledge of trends in life expectancy is of major importance for policy planning. It is also a key indicator for assessing future development of life insurance products, substantiality of existing retirement schemes, and long‐term care for the elderly. This article examines the feasibility of decomposing age‐gender‐specific accidental and natural mortality rates. We study this decomposition by using the Lee and Carter model. In particular, we fit the Poisson log‐bilinear version of this model proposed by Wilmoth and Brouhns et al. to historical (1975–1998) Spanish mortality rates. In addition, by using the model introduced by Wilmoth and Valkonen we analyze mortality‐gender differentials for accidental and natural rates. We present aggregated life expectancy forecasts compared with those constructed using nondecomposed mortality rates.