Mortality Tables: CSO, VBT, and Projection Scales

Standard Mortality Tables

Actuaries use several standard mortality tables depending on the application. The Commissioners Standard Ordinary (CSO) table is prescribed for statutory reserve calculations and nonforfeiture values in life insurance. The Valuation Basic Table (VBT) reflects raw mortality experience without the margins added for the CSO and is used for principle-based reserving and other analyses requiring best-estimate mortality. For pension applications, the RP-2014 (and successor) tables provide mortality rates for retirement plan participants, with separate tables for employees, healthy annuitants, and disabled annuitants.

Mortality Improvement Scales

Mortality has generally improved over time, and projection scales capture this trend for forward-looking analyses. The SOA publishes mortality improvement scales (MP-2021 and updates) based on historical mortality data and expert judgment about future trends. These scales project how mortality rates will change in future years and are critical for pension and annuity valuations, where the present value of future benefits increases as people live longer. The two-dimensional nature of these scales (varying by both age and calendar year) allows for different improvement rates at different ages and for the gradual convergence of near-term and long-term improvement assumptions.