Life Tables: Mapping Human Longevity

A life table (also known as a mortality table) is the primary tool used by life actuaries. It tracks a hypothetical cohort of people from birth until death, providing a statistical snapshot of a population’s mortality.

1. Key Columns in a Life Table

• $l_x$: The number of people alive at age $x$.
• $d_x$: The number of people who die between age $x$ and $x+1$.
• $q_x$: The probability that a person aged $x$ will die before reaching $x+1$.

2. Mortality Rates vs. Age

Mortality typically follows a “U-shape” or a “J-shape”—relatively high at birth, very low during youth, and exponentially increasing at older ages.

3. Stochastic Nature of Life

Actuaries don’t predict when a specific individual will die. Instead, they model the stochastic process of a large group to ensure that the insurance pool remains solvent.

💡 Professor’s Tip

Mortality is not static. Actuaries must account for “Mortality Improvement”—the trend that people are living longer due to medical advances and better lifestyles.

🔗 Next Step

• Ch3: Foundations of Pension Math