Regulatory Problems In Longevity Risk Management In The Polish Pension System

Life expectancy has been increasing since the XX century and the first two decades of the XXI century globally, especially in developed OECD countries, including Poland. But future trends of lifespan for different countries and demographic cohorts remain uncertain. One of the many economic and social consequences of this process is the increase in the longevity risk in social security systems. The longevity risk (life expectancy risk) is the risk of living longer than expected. On an individual basis, the realization of longevity risk can cause exhaustion of pension savings and often poverty for elderly people. Group (aggregate) longevity risk – the risk that a certain age cohort will live longer than expected – is relevant for public and private institutions which are obliged to pay lifetime annuities. This article focuses on the issues of managing longevity risk in the pension system in Poland, in particular – the construction of public and supplementary pension systems and its ability to adapt to the challenges associated with longevity risk.