What Is the 2017 CSO Mortality Table?

The 2017 CSO Mortality Table, formally known as the 2017 Commissioners Standard Ordinary Mortality Table, is a standardized table of mortality rates developed by the American Academy of Actuaries and the Society of Actuaries, and formally adopted by the National Association of Insurance Commissioners (NAIC). It is primarily used in the life insurance industry to calculate reserve requirements, set premium rates, and evaluate policy risks. This table replaced the earlier 2001 CSO Mortality Table, reflecting updated data and changing trends in life expectancy and mortality.

Origins and Development

Mortality tables are essential tools in life insurance, actuarial science, and financial planning. They provide statistically derived estimates of the probability that a person at a given age will die before their next birthday. These probabilities are the foundation for calculating the cost of providing life insurance coverage.

The CSO mortality tables are periodically updated to reflect changing longevity trends. The 2017 CSO Table was developed using data from U.S. life insurance companies, capturing experience from policyholders between 2002 and 2009. It includes adjustments for projected mortality improvements through 2017 and reflects more current underwriting standards and medical advancements.

The Society of Actuaries compiled the underlying experience data, while the NAIC authorized its use for regulatory purposes beginning January 1, 2020, though insurance companies were permitted to adopt it earlier. The new table was adopted by insurers over a transition period, ultimately becoming the default standard for reserve and nonforfeiture calculations.

Structure of the Table

The 2017 CSO Mortality Table includes multiple components to reflect different populations and product types:

• Sex-distinct tables: Separate tables exist for male and female insured lives due to inherent biological differences in mortality patterns.
• Smoker and non-smoker distinctions: The table accounts for the impact of tobacco use on life expectancy by providing distinct mortality rates.
• Composite tables: These combine smoker and non-smoker rates into a single set of values, often used when the insurer does not underwrite based on smoking status.
• Preferred and standard underwriting: The 2017 CSO reflects more refined underwriting classes, such as preferred nonsmoker or standard smoker, acknowledging that insurers often segment applicants more granularly than in the past.

Each table provides annual mortality rates (denoted as qx)—the probability of death within one year for individuals at each age, usually starting from age 0 up to age 120. These rates are used to determine the present value of future death benefits, which in turn supports proper pricing and reserve setting.

Key Changes from the 2001 CSO

One of the most important motivations behind the 2017 CSO update was the need to incorporate observed improvements in mortality and changes in life insurance underwriting. Key differences between the 2001 and 2017 tables include:

• Lower overall mortality rates: People are living longer, and the updated data reflects decreased death rates across most age groups.
• Improved granularity: The 2017 CSO includes more detailed classification of risks and underwriting types, allowing insurers to price more accurately based on applicant characteristics.
• Extended age range: The table goes up to age 120, supporting longer-duration policies and more conservative reserving for advanced ages.
• Revised valuation interest rate framework: When paired with updated statutory interest rate guidelines, the 2017 CSO impacts reserve calculations by requiring insurers to hold reserves based on more conservative assumptions about both mortality and investment income.

These updates mean that, in many cases, premiums calculated using the 2017 CSO may be slightly lower due to decreased mortality assumptions, though reserve requirements may be higher due to regulatory conservatism.

Regulatory and Industry Impact

The adoption of the 2017 CSO Mortality Table has several important regulatory implications. Life insurance companies are required by state insurance departments to use the CSO tables to determine minimum reserve requirements and nonforfeiture values. These reserves ensure that insurers maintain enough assets to meet future policy obligations.

The NAIC approved the use of the 2017 table for policies issued on or after January 1, 2020, with an optional phase-in beginning January 1, 2017. After 2020, insurers were no longer permitted to issue new policies based on the 2001 CSO Table. This shift required insurers to update their pricing systems, valuation models, and regulatory filings.

From a business perspective, the table affects product design, especially for long-duration policies such as whole life, universal life, and term insurance. It also plays a role in cash value accumulation, guaranteed policy benefits, and policyholder dividends for participating policies.

Use in Financial Planning and Insurance

While the 2017 CSO Mortality Table is primarily a tool for insurers and actuaries, its effects are indirectly felt by consumers and financial planners. The table influences:

• Premium rates: As insurers rely on mortality tables to assess risk, more favorable mortality assumptions can lead to competitive pricing.
• Policy guarantees: The reserve requirements impact what benefits insurers can guarantee to policyholders.
• Illustrations and projections: Financial planners using life insurance as part of an estate or retirement strategy often work with assumptions influenced by CSO tables, even if not directly referencing them.

Importantly, while the 2017 CSO Table offers a standardized basis, insurers often adjust their internal pricing assumptions to reflect company-specific experience, underwriting results, or competitive considerations.

Limitations and Ongoing Relevance

Despite its importance, the 2017 CSO Table is not intended to predict individual outcomes or serve as a precise forecasting tool. It reflects average expected mortality across large groups, not specific medical or lifestyle factors unique to any one person. Moreover, as life expectancy continues to rise, future tables will need to account for continued medical and technological improvements.

The table also doesn’t account for emerging underwriting techniques like predictive analytics, genetic testing, or wearable health data, though these may shape the next iteration of mortality standards.

The Bottom Line

The 2017 CSO Mortality Table is a foundational element in the U.S. life insurance industry, guiding how insurers calculate premiums, establish reserves, and comply with regulatory mandates. It reflects modern mortality data, improved longevity, and advances in underwriting practices. While largely invisible to consumers, its influence is felt in the structure and cost of life insurance policies and the financial strength of insurers offering them.

As life expectancy continues to evolve, and new technologies impact how we assess health risk, future updates to CSO tables will remain a necessary part of ensuring that insurance products stay aligned with both actuarial science and consumer needs.