Should pension schemes consider the impact of all serious diseases rather than just COVID-19?

Yes is the simple answer!

The Office for National Statistics (ONS) have released their latest data on deaths registered to 28 August 2020 and COVID-19 deaths continue to remain very low (see the XPS COVID-19 Tracker). However, another potentially serious disease (especially in the winter months) is influenza. Deaths from influenza and pneumonia are starting to increase and have been higher than COVID-19 deaths since mid June 2020. Every year there is a surge in winter influenza deaths, despite a substantial vaccination programme, and the number who die varies significantly between about 10,000 to 30,000 in large part due to the effectiveness of the vaccine in that year.

So who is vulnerable to influenza? There are striking similarities to COVID-19. The NHS advises all those with chronic heart and respiratory diseases, diabetes and those seriously overweight (BMI>40) amongst others to get vaccinated against influenza. These co-morbidities are all listed among the highest risk factors for COVID-19. Given COVID-19 deaths are currently low in the midst of a second wave of COVID-19 infections, can we imply that if those who are vulnerable to COVID-19, and by extension to influenza, are taking sensible precautions to protect themselves that the number of deaths caused by influenza might be lower than normal this year?

As well as respiratory diseases, other serious chronic conditions should be considered (both individually and together) to form a view of the health characteristics of scheme members. Income has historically been the key driver when setting scheme specific longevity assumptions, i.e. those who are wealthier are healthier, but given more information on health is now available it surely should be used? Our member profiling service can identify the health characteristics of members and other useful information, such as cohabitation rates, which can be used to inform assumption setting come valuation time and experience tells us the funding difference can be material (see COVID specific health vulnerability analytics here).