Pension schemes adopting the latest mortality figures from the Institute and Faculty of Actuaries could see their liabilities increase by more than 1 per cent.

The warning has come from Hymans Robertson’s longevity analysis unit, Club Vita, who has said that it is looking increasingly likely that 2019 will see the lowest total amount of deaths in the UK since 2014.

The Institute’s Continuous Mortality Investigation (CMI) Q3 Mortality Monitor has found that mortality in the third quarter of 2019 was relatively light compared to the 2009-2018 average, continuing the period of relatively light mortality observed in the second half of 2018 and the first half of 2019.

Annual average Standardised Mortality Rates (SMRs) have shown a fairly steady fall this century from 1.75 per cent in early 2000 to 1.3 per cent by mid-2011. From mid-2011 to mid-2018, the annual average SMR was fairly flat, remaining within the range from 1.24 per cent to 1.34 per cent.

However, at the end of the third quarter of 2019, it has now fallen to a new low of 1.2 per cent.

In its latest Mortality Monitor report, the Institute has said that cumulative standardised mortality in 2019 continues to be well below the ten-year average: “Mortality in 2019 was similar to mortality in 2014 until the end of May, but has diverged since then and 2019 now has lower cumulative standardised mortality up to the end of week 39 than any other year shown [by the CMI Monitor],”

Club Vita head of analytics Conor O'Reilly, said that the new low rate was welcome news, but could significantly affect pension scheme funding positions.

“What may be less welcome is the likely impact on liabilities — pension schemes adopting the latest CMI model could see their liabilities increasing by upwards of one per cent as a result of this experience,” he said.

“We will be watching with interest to see whether this is the start of another period of strong improvements in mortality rates, as seen over the 2000s, or simply further volatility, as seen more recently.”

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