8th Actuarial Review

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The present actuarial review covers the 5-year period up to 30 June 2010 and presents a projection of the financial situation of the National Insurance System for the next 50 years.

Experience of the NIS since the last actuarial review


Contribution income and benefit expenditures have closely matched projections over the period from 1 July 2005 to 30 June 2010. The TT$3.3 billion shortfall in accumulated assets at the end of the financial year 2009-2010 is essentially due to unfavourable deviations regarding investment returns.

With effect from January 2008, a new contribution rate schedule has been adopted and modifications have been introduced to different benefits. In February 2012, the minimum pension has been increased to TT$3,000. All these modifications are reflected in the present actuarial review.

During the period from 1 July 2005 to 30 June 2010, the cumulative inflation rate reached 52.3 percent. This must be considered for the adjustment of benefits in January 2013.

Demographic pressure


The total population of Trinidad and Tobago will increase from 1,317,714 in 2010 to 1,431,642 in 2036 and will then initiate a slow decrease to reach 1,341,694 in 2060. The number of persons at pensionable age (60 and over) will grow from 161,051 in 2010 to 412,423 in 2060, while the population aged 16 to 59 (the contributory base) will decrease by 18 per cent. The number of working-age persons for each person aged 60 and over will thus fall dramatically from 5.4 to 1.7 over the projection period.

NIS demographic and financial projections

The total number of pensioners is projected to increase significantly in the future, from 112,553 in 2009-10 to 321,953 in 2060, while at the same time the number of contributors will fluctuate around 500,000 for the next 25 years and then start to decline to 400,000 in 2059-60. The ratio of contributors to pensioners will thus decrease from 4.3 to 1.3 over the next 50 years.

Financial projections reveal that system’s expenditure will exceed contribution income from financial year 2012-13. Total assets of the NIS will however continue to increase until 2026-27. From 2027-28, assets will rapidly decrease and the NIS funds will be completely depleted in 2039-40 if nothing is modified in terms of contributions or benefits of the system. The pay-as-you-go (PAYG) cost rate is projected to increase from its current level of 9.1 percent in 2010-11 to 29.8 percent in 2059-60. The general average premium of the system (the constant contribution rate necessary to finance all NIS benefits over the next 50 years) is 17.6 percent. This may be compared to the present contribution rate of 11.4 percent.

The contribution rate should be increased from 2013 at least to face the PAYG cost of the system over the period 2013-2017. Thereafter, there is a need to plan for long-term contribution rate increases. One possible schedule of contribution rates is as follows:

Period Contribution rate
2013 to 2017 12%
2018 to 2020 15%
2021 to 2040 17%
2041 to 2060 25%


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National Insurance Board of Trinidad and Tobago (NIBTT)