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Speaker(s): Ralf Knobloch
The populations is aging in most countries.The over 65 group (the traditional fixed age for 'retirement') is growing rapidly, in absolute terms and relative to the population.This group's wealth is also growing rapidly. Yet the concept of retirement, so well entrenched in our minds, is very recent and continues to evolve.A major challenge is managing the decumulation phase of defined contribution retirement funds efficiently and addressing longevity risk.
Debates around retirement incomes and provision for sustainable and dignified living after retirement typically focus on the provision of retirement income streams. They implicitly presume retirees are healthy, interested, wealthy, and confident to make 'sensible' decisions.These assumptions become increasing less valid as people age.As anyone who has dealt with someone with dementia knows, putting money into an account does not help them as they are unlikely to be capable of accessing or spending it.The Australian Bureau of Statistics projects that dementia will become the leading cause of death in Australia within 5 years, and Australia is not atypical of developed countries.
The over 80 group (representing an age where retirees begin moving into the passive phase of retirement) is growing quickly, in absolute terms, relative to the population and the population over 65.In terms of size and wealth this group is potentially a viable commercial market in its own right.However, there seems little evidence commercial insurers (life and health), or broader based service providers, recognise this market or its needs, which differ from those of the more active over 65 'entering retirement' market.
This paper provides an approach to assess the over 80s market and develop suitable products and services that can be provided sustainably while addressing the needs of those retirees as they age and may have diminishing capacity.It has global relevance.