May 2021 – Page 10 – Actuarial News

The Cost of Insuring Colleges Continues to Rise. And Covid’s Not the Reason.

May 12, 2021May 12, 2021 Mary Pat Campbell

Link: https://www.chronicle.com/article/the-cost-of-insuring-colleges-continues-to-rise-and-covids-not-the-reason?cid2=gen_login_refresh&cid=gen_sign_in

Excerpt:

Colleges face an increasingly complex and unpredictable array of challenges — abuse, harassment, assault, police misconduct, accidents, health and environmental hazards, fiduciary wrongdoing, the pandemic — that are making it more difficult to calculate risk and insure against it.
That’s a big part of why annual insurance premiums have gone up by double digits in recent years. John McLaughlin, senior managing director of the higher-education practice at Gallagher, an insurance brokerage and risk-management and consulting firm, says those increases range between an average of 10 and 35 percent across an institution’s insurance portfolio.
….
But what’s striking is that just behind enrollment on colleges’ list of worries are two areas that are not directly related to Covid: data security and Title IX. That’s according to an annual survey by United Educators, which provides liability insurance and risk-management services for its member colleges and schools. The survey was conducted from May 2019 through September 2020, as the coronavirus crisis unfolded, and 480 United Educators member institutions responded.

Author(s): Alexander C. Kafka

Publication Date: 3 March 2021

Publication Site: Chronicle of Higher Education

Data proves it: Pandemic is no excuse for NYC’s rising tide of violent crime

May 12, 2021May 12, 2021 Mary Pat Campbell

Link: https://nypost.com/2021/05/09/pandemic-is-no-excuse-for-nycs-rising-tide-of-violent-crime/

Excerpt:

So he [NYC Mayor Bill de Blasio] hasn’t acted with much urgency as the murder rate rose 47 percent last year, to a total of 468 people killed, and has risen this year, so far, by 17 percent.
…..
In London, the global city that most closely resembles Gotham, the murder rate plummeted last year. It fell to 126 from 150, down 16 percent.
Why? Well, that’s obvious: It was the global pandemic. “Many, many crime types have reduced as you would expect,” said Met Police chief Cressida Dick, noting that fewer people were outside to fight with each other.
How about Italy, hit hard and early by the pandemic? There, murders fell by 14 percent, to 271 from 315.
France with its troubled banlieues? The country’s murders were down 2 percent in 2020, to 863.
….
But these are all safe countries anyway. So what about cartel-ridden Mexico? There, murders fell by slightly less than half a percent last year, to 34,523 — the first decline in six years.

Author(s): Nicole Gelinas

Publication Date: 9 May 2021

Publication Site: NY Post

Which Public Pension Funds Have the Highest Holdings of Alternative Assets? 2021 Edition

May 12, 2021May 12, 2021 Mary Pat Campbell

Link: https://marypatcampbell.substack.com/p/which-public-pension-funds-have-the

Graphic:

All the data for alternative allocation 2001-2020, with key percentiles plotted as lines

Excerpt:

What you see in that graph is a data point for each of the plans I know their asset allocation for, with the median, 25th percentile, and 75th percentiles marked out so you can see the allocations increasing.
That pattern does not make me feel good.
Allocating more to alternatives doesn’t seem to get asset managers higher returns. But the group is generally sliding upwards in their allocations, and I’m very unhappy about this.

Author(s): Mary Pat Campbell

Publication Date: 11 May 2021

Publication Site: STUMP at substack

F.B.I. Asking Questions After a Pension Fund Aimed High and Fell Short

May 11, 2021May 11, 2021 Mary Pat Campbell

Link: https://www.nytimes.com/2021/05/11/business/dealbook/psers-pennsylvania-fund-fbi.html

Excerpt:

The search for high returns takes many pension funds far and wide, but the Pennsylvania teachers’ fund went farther than most. It invested in trailer park chains, pistachio farms, pay phone systems for prison inmates — and, in a particularly bizarre twist, loans to Kurds trying to carve out their own homeland in northern Iraq.
Now the F.B.I. is on the case, investigating investment practices at the Pennsylvania Public School Employees’ Retirement System, and new questions are emerging about how the fund’s staff and consultants calculated returns.
…..
The error in calculating returns was a tiny one, just four one-hundredths of a percentage point. But it was enough — just barely — to push the fund’s performance over a critical threshold of 6.36 percent that, by law, determines whether certain teachers have to pay more into the fund. The close call raised questions about whether someone had manipulated the numbers and the error wasn’t really an error at all.
…..
“If you can’t change the benefits, and you can’t change the contributions, the only lever left for these people to pull is investment policy — that’s it,” said Kurt Winkelmann, a senior fellow for pension policy design at the University of Minnesota’s Heller-Hurwicz Economics Institute. “And that exposes younger beneficiaries and taxpayers to a lot of risk.”

Author(s): Mary Williams Walsh

Publication Date: 11 May 2021

Publication Site: New York Times

To Protect Australian Workers’ Retirement Savings, We Must Democratize Pensions

May 10, 2021May 10, 2021 Mary Pat Campbell

Link: https://jacobinmag.com/2021/05/australia-pensions-superannuation-super-industry-funds-democratic-control-investment-vanguard-equity-stock-market

Excerpt:

By design, Australia’s existing superannuation system reproduces inequalities built into the labor market. This is because employers must pay super as a proportion of wages into individual accounts that then earn compounding returns. Upon retirement, high-income workers may find they own a significant pool of capital.
Meanwhile, lower-income workers — disproportionately women — retire with the lowest super balances. The same will be true of younger or marginalized workers who are trapped in precarious or informal employment. As wages continue to decline and precarious work becomes more prevalent, the number of people with a stake in defending superannuation is shrinking year by year.
To make matters worse, in its present form, superannuation undermines genuinely redistributive institutions like the age pension. This is because conservative political forces are able to present them as a last-resort safety net rather than a guarantee of the right to a decent retirement.

Author(s): Robert Lechte

Publication Date: 9 May 2021

Publication Site: Jacobin Magazine

Third withdrawal of 10: How will the mechanism for pensioners for annuities work?

May 10, 2021May 10, 2021 Mary Pat Campbell

Link: https://www.t13.cl/noticia/negocios/rentas-vitalicias-como-funcionara-retiro-dineros-como-solicitar-afp-tercer-retir-10-28-04-21

[auto-translated by Google]

[this relates to people in Chile being allowed to taking fairly large withdrawals from their official retirement savings]

Excerpt:

This Monday, the application process will begin through digital platforms within the framework of the new 10% third withdrawal law.
As detailed by the Undersecretary of Social Welfare, Pedro Pizarro, the process will begin 100% online during the first two weeks of May, both for AFP users and for the nearly 700 thousand pensioners through the life annuity modality , who for the first time may request a cash advance.
In view of this process, the Financial Market Commission is preparing an instruction manual to regulate the unprecedented withdrawal of savings in the form of life annuities, which – they assure – will be published shortly (In this same note we will update the news of said instruction )

Publication Date: 2 May 2021

Publication Site: T13 in Chile

Pension plan conversion a hot topic at the end of the ND Legislative session

May 9, 2021May 9, 2021 Mary Pat Campbell

Link: https://news.prairiepublic.org/post/pension-plan-conversion-hot-topic-end-nd-legislative-session

Excerpt:

A bill to change the pension plan for public employees will be one of the last measures the Legislature will consider.
It would affect people hired after January first, 2023.
Right now it’s a “defined benefit” plan. The bill would make it a “defined contribution” plan.
The current system has an unfunded liability of $1.4 billion. And the proposal would put money toward the current plan over several years to pay that down. Supporters say people who are on the defined benefit plan would have an option to convert to a defined contribution plan, but that would not be mandated.

Author(s): Dave Thompson

Publication Date: 25 April 2021

Publication Site: Prairie Public News

Editorial: Don’t further punish Florida state, local government retirees

May 9, 2021May 9, 2021 Mary Pat Campbell

Link: https://www.palmbeachpost.com/story/opinion/editorials/2021/04/25/editorial-dont-further-punish-florida-state-local-government-retirees/7331804002/

Excerpt:

A closer look at the FRS shows that there is no problem to be fixed, leaving SB 84 little more than a vehicle to divert millions that would appreciate over time into alternative — and riskier — investment funds managed by Wall Street firms friendly to Republican politicians.
The Senate’s consternation over Florida’s retirement program might surprise people who actually know something about it. The state’s pension program still has a AAA credit rating and a very manageable liability relative to the size of Florida’s economy. Its funded ratio sits among the nation’s best. Its sizeable returns on investment pay the bulk of retirement benefits.
“I would say overall that we’re in a reasonably good place, and we’re heading in the right direction,” said Ash Williams, executive director and chief investment officer for the State Board of Administration, the body responsible for managing the state’s defined contribution program.

Author(s): Editorial board

Publication Date: 25 April 2021

Publication Site: Palm Beach Post

A Preliminary Analysis of U.S. and State-Level Results From the 2020 Census

May 9, 2021May 9, 2021 Mary Pat Campbell

Link: https://www.census.gov/library/working-papers/2021/demo/POP-twps0104.html

Graphic:

Choropleth of change in population by state (plus DC & Puerto Rico), 2010-2020

Description:

This paper considers the 2020 Census national and state-level resident population counts in historical and evaluative contexts. By comparing the first results of the 2020 Census against benchmark data sources, we examine how the nation has changed at the highest levels and set the stage for the comprehensive analyses still to come.

Link to paper: https://www.census.gov/content/dam/Census/library/working-papers/2021/demo/pop-twps0104.pdf

Publication Date: 26 April 2021

Publication Site: Census Bureau

Motor Vehicle Deaths in 2020 Estimated to be Highest in 13 Years, Despite Dramatic Drops in Miles Driven

May 8, 2021May 8, 2021 Mary Pat Campbell

Link: https://www.nsc.org/newsroom/motor-vehicle-deaths-2020-estimated-to-be-highest

Excerpt:

For the first time since 2007, preliminary data from the National Safety Council show that as many as 42,060 people are estimated to have died in motor vehicle crashes in 2020. That marks an 8% increase over 2019 in a year where people drove significantly less frequently because of the pandemic. The preliminary estimated rate of death on the roads last year spiked 24% over the previous 12-month period, despite miles driven dropping 13%. The increase in the rate of death is the highest estimated year-over-year jump that NSC has calculated since 1924 – 96 years. It underscores the nation’s persistent failure to prioritize safety on the roads, which became emptier but far more deadly.
An estimated 4.8 million additional roadway users were seriously injured in crashes in 2020, and the estimated cost to society was $474 billion. With the alarming picture painted by these data, NSC is urging President Joe Biden and Transportation Secretary Pete Buttigieg to commit to zero roadway deaths by 2050 – a call NSC and more than 1,500 other organizations and individuals made in January in a letter to the new administration.

Publication Date: 4 March 2021

Publication Site: National Safety Council

GameStop Frenzy, Archegos Meltdown May Prompt New SEC Rules, Chairman Says

May 8, 2021May 8, 2021 Mary Pat Campbell

Link: https://www.wsj.com/articles/sec-studying-whether-new-rules-are-needed-for-apps-that-gamify-trading-chairman-says-11620239971

Excerpt:

In testimony prepared for the House Financial Services Committee, Securities and Exchange Commission Chairman Gary Gensler says brokerages that “gamify” trading — by using appealing visual graphics to reward a user’s decision to trade, for instance — may encourage frequent trading that results in worse outcomes for investors. Some Democratic lawmakers have blamed gamification for the boom in individual trading that helped drive the rise in GameStop shares.
Mr. Gensler, who will appear before lawmakers on Thursday, also said the SEC would study regulatory changes in response to the March blowup of Archegos Capital Management, an unregulated family-investment vehicle of hedge-fund veteran Bill Hwang whose leverage-fueled bets led to more than $10 billion in losses at major global banks.

Author(s): Dave Michaels, Alexander Osipovich

Publication Date: 5 May 2021

Publication Site: Wall Street Journal