The objective of the Association is to provide a forum for market participants to collaborate with a view to articulating criteria for, and assisting in the establishment of suitable and consistent standards, conventions and best practices to promote liquidity in the trading of financial instruments that reference longevity and mortality related risks as well as consistency of relevant demographic data.
Benefits that will be delivered by the Association include improved transparency due to the development of standard indices for longevity, standard financial products linked to longevity and standard methodologies for valuing products.
The primary focus of the LLMA is pension-related longevity and mortality, rather than life settlements. In the short term the LLMA will be primarily focused on the UK market for longevity and mortality, but may later expand its horizons to other countries.
The focus of the Initiative is exclusively on macro-life related longevity and mortality risk and not on micro-life (i.e. Life Settlements).
Current members of the LLMA are:
AVIVA, AXA, Deutsche Bank, J.P. Morgan, Morgan Stanley, Prudential PLC and Swiss Re.
UBS was a member until July 2012.
Legal & General, Munich Re, Pension Corporation and RBS were members until August 2014.
The consortium is not a commercial or for-profit venture and it is the intention that any IP developed by the consortium will be made available for use by all market participants.
The LLMA plans to set standards for the new trading market it wish to promote. These are likely to include:
- Templates for standardised longevity products
- A longevity trading index
- Standardised Valuation model for longevity
If you are interested in the work of the LLMA and would like to find out more, please contact us.