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David Blake wins prestigious award

David Blake, Professor of Pension Economics at the Cass Business School, City University London has been selected as this year's recipient of the prestigious Robert I. Mehr Award for his article "Survivor Bonds: Helping to Hedge Mortality Risk"
by Chris Johnson

big_thumbnailThe award is given annually to the article that has best stood the test of time during its ten-year release and has had an impact in the field of risk and insurance. The paper was published in the June 2001 Issue of The Journal of Risk and Insurance, which is the Journal of the American Risk and Insurance Association (ARIA).

Professor Blake's paper is credited with developing a new global capital market (the 'Life Market') in mortality risk transfers between pension funds, life assurers and capital market investors and caused a knock-on effect in the industry:

Timeline
• 2001: David Blake and William Burrows publish: "Survivor Bonds: Helping to Hedge Mortality Risk" which suggests the creation of 'survivor bonds' which would allow pension funds and the issuers of annuities to hedge aggregate mortality risk.

• 2003: The first mortality catastrophe bond creates the 'Life Market'

• 2006: The world's first pension buy-out

• 2007: The world's first pension buy-in and first longevity swap

• 2010: The world's first longevity bond issued, while a Dutch pension fund performs the first pension buy-in outside the UK

• 2011: A Canadian pension fund executes the first pension buy-out outside the UK and the first international longevity reinsurance transaction takes place between Rothesay Life in the UK and Prudential Retirement in the US.

The ARIA is the premier professional association of insurance scholars and risk management and insurance professionals. The award presentation will take place at their annual meeting which is recognized as the top event each year for academics and researchers in the field of risk management and insurance. The meeting takes place from the 7th-10th August in the beautiful city of San Diego, California. The keynote speaker at the event will be Nobel Laureate Harry Markowitz, winner of the John von Neumann Theory Prize and the Nobel Memorial Prize in Economic Sciences.

Professor Blake, who is also Director of the Pensions Institute at Cass said: "I am delighted to receive the Robert I. Mehr Award from the American Risk and Insurance Association in recognition of the fact that my paper "Survivor Bonds: Helping to Hedge Mortality Risk" (co-authored with William Burrows) has stood the test of time. I was very pleased when the Journal of Risk and Insurance agreed to publish the paper in 2001. I am even more pleased to see that this paper led to the development of a new global capital market in mortality risk transfers between pension funds, life assurers and capital market investors."

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