GERMANY - The doctors' pension fund for Westfalen-Lippe (ÄVWL) has raised the retirement age to deal with a surprise increase in longevity.
Ten years after the introduction of separate mortality tables for self-employed Germans, including doctors and lawyers, updated statistics now show life expectancy has "increased more than expected".
While a 60-year-old male doctor was estimated to live to 82.8 on average he is now more likely to see his 88th birthday. For women of the same age life expectancy has increased from 87.6 to 91.
"Especially serious is the fact that self-employed doctors and lawyers live around four years longer than the average German," the fund noted in a statement.
For the doctors' fund in the western German region the increase in longevity will lead to an underfunding by €1.13bn by January when the new tables come into effect.
To prevent this funding shortfall, the board decided to raise the retirement age for members from 65 to 67 step by step.
All members born after 1949 will feel the increase. But only those born after 1960 will have to work full two years longer to receive their full pension.
The fund noted it had decided against taking a similar step as in 1997 when the first longevity tables for self-employed would have led to an underfunding of €1.4bn.
Back then, pension increases were stopped for several years.
This time, the measure will take effect immediately and the fund will be able to adjust pensions against inflation again in future.
For 2009 no increase is planned "to fully balance out the underfunding caused by the new mortality tables", the ÄVWL told its members.
Together with the statutory retirement age the fund also raised the earliest possible age at which members can draw a pension from 60 to 62 for those born after 1960 with the same step-by-step increase as with the statutory retirement age applying for those born between 1949 and 1960.
The "cost" of early retirement remains at 0.4% for every month.