LIFE EXPECTANCIES AND VALUE OF WORK FACTORS 2003

The Australian Government Actuary periodically publishes a life table. The latest table was published in August 1999 and is based on the mortality of Australians over the three year period centred on the 1996 Census. This table is called the Australian Life Tables 1995-97. The most recent census was held on 7th August, 2001, but the corresponding life table is not available yet.

It is important to note that the mortality in the table is a "snapshot". It understates the life expectancy of a person currently alive since there is no allowance made for likely mortality improvements. The likelihood of improvements can be shown from past life tables which have the following life expectancies:

MALE
Life Table	Age 0	Age 30	Age 65
1891-1900	51.08	35.11	11.25
1920-22	59.15	38.44	12.01
1946-48	66.07	40.40	12.25
1965-67	67.63	40.72	12.16
1985-87	72.74	44.84	14.60
1995-97	75.69	47.26	16.21

FEMALE
Life Table	Age 0	Age 30	Age 65
1891-1900	54.76	37.86	12.75
1920-22	63.31	41.48	13.60
1946-48	70.63	44.08	14.44
1965-67	74.15	46.34	15.70
1985-87	79.20	50.49	18.56
1995-97	81.37	52.30	19.88

Various scenarios for future mortality improvement can be constructed. The three usual sets of mortality rates are based on:

• Improvement rates over the last 25 years;
• Improvement rates over the last 100 years; or
• ABS improvement rates.

The ABS mortality improvement rates were created by projecting trends in causes of death. I refer the reader to Australian Life Tables 1995 - 97 (published by the Australian Government Actuary) and Population Projections 1997 - 2051 (ABS Catalogue No. 3222.0) for more details.

The tables below show life expectancies and the value of $1 per week at various real interest rates for a loss starting in 2002 for life (or ceasing at the earlier of death and either age 60 or age 65).

Life Expectancies for Males and Females in 2003

Value of $1 p.w. at 3% p.a.

Value of $1 p.w. at 4% p.a.

Value of $1 p.w. at 5% p.a.

Value of $1 p.w. at 6% p.a.

Value of $1 p.w. at 7% p.a.

For calculations where a regular loss is not envisaged (e.g. part-time followed by full-time work; a mixture of low and high future care costs), or realistic models that have both inflation and discount assumptions etc. please contact:

Brian Bendzulla, B.Sc. FIAA
Director/Actuary
Bendzulla Actuarial Pty Ltd

GPO Box 1181, Hobart TAS 7001
Fax 1800 103 123   Tel 1800 203 123
Email: brian@bendzulla.com

Return to Legal page.