Life expectancy estimates are used by life insurance companies and other organizations in various ways. The Life Settlement market relies heavily on this type of data to ensure the health of their portfolios. Let’s take a look at how life expectancy estimates are created, and what they include.

How Life Expectancy Estimates are Calculated

Life Expectancy (LE) estimates take a number of factors into account. ITM TwentyFirst uses our own proprietary system and underwriting manual to produce a life expectancy estimate.  Underwriters review medical records and input conditions and other factors (e.g. medical conditions, family history, BMI, lifestyle factors) relevant to the insured into our system. The system calculates the life expectancy based on the mortality multiplier for the insured (which is derived from the credits and debits we assign to the various factors the underwriters input in the system) to come up with the mortality multiplier.

The underwriting approach is rules-based. It is designed to limit underwriter subjectivity and provide consistent, reproducible results.

The mortality tables are based entirely on our own experience and include continuous mortality improvement factors.

What a Typical Life Expectancy Estimate Includes

When a life expectancy estimate is issued by ITM TwentyFirst, the report will include:

(1) Mean and median life expectancy

(2) First year multiplier and full mortality curve,

(3) The top 3 conditions of the insured that we identified in the medical records having the most impact on the estimate (either debits or credits).  Other conditions with less impact along with those that may have no impact, are grouped together under body systems.

A sample estimate can be found here: (Sample Life Expectancy Estimate).

Final Thoughts

Life expectancy estimates are a great tool to aid in making decisions relating to policy management and life settlements. Other areas where a life expectancy estimate may assist in making decisions include:

  • When to start receiving retirement benefits
  • Litigation of cases where life expectancy is relevant
  • How to invest your money – financial planning


For more information about Life Expectancy Estimates and how they are calculated, check out Chapter 15 of TOLI Handbook which you can download for free at