Hi, It states in the solution for Q6 Demographic changes "changes to longevity and/or fertility rates will impact dependency ratios and hence affordability of state-run schemes" Why/how would this change the affordability of state-run schemes? Thanks
Hi AKS01, This is saying that any changes to the longevity and/or fertility rates will affect the proportion of workers to pensions, and thus this will affect the affordability of state run schemes.... and this could go on to impact the demand for pension products. Ie if there are a lot of pensioners, and not many workers in society, the cost will be very high to provide pension benefits through the state. Thanks Aman ActEd Tutor
