RGA CEO warns longevity insurance gap emerges as U.S. life expectancy surges 5.3% since 1990

RGA CEO Tony Cheng has sounded a warning about the evolving risks facing insurers and American consumers as life expectancy steadily rises. While longer lifespans are a societal triumph, Cheng argues that the deeper crisis lies in individuals outliving their savings—a phenomenon creating a “longevity insurance gap” that demands urgent attention from governments, insurers, and individuals. His remarks, made during an exclusive interview with Fortune, highlight the complex intersection of demographic shifts and financial preparedness [1].

Life expectancy in the U.S. has climbed significantly over the past three decades, from 75 years in 1990 to nearly 79 by 2022, despite a pandemic-driven dip. Similar trends are evident in G7 nations, where average life expectancy rose from 77 in 1990 to 82.5 by 2022. These gains, while positive, introduce unintended consequences. Insurers like RGA, which manages both mortality risk (paying out on death) and longevity risk (payouts for extended lifespans), face a shifting landscape. Longer lives may reduce demand for traditional life insurance, yet Cheng cautions that the real threat is people’s underpreparedness for retirement. “The consumer’s stronger awareness that they may outlive their savings is scary,” he said [1].

Cheng attributes this gap to a human tendency to prioritize immediate needs over long-term planning. Life insurance remains critical for addressing sudden risks—such as covering a mortgage after an untimely death—but retirement planning often takes a backseat. This behavior exacerbates the longevity insurance gap, as individuals increasingly rely on the assumption that government support will bridge the shortfall. However, with public budgets under strain, private solutions may become essential. Cheng emphasized that bridging this gap requires broader financial literacy and systemic reforms, though he warned that awareness is likely to develop slowly and “potentially too late” [1].

The challenge extends beyond individual preparedness. Government education, private-sector innovation, and consumer engagement must align to create effective solutions. Cheng noted that wealthier individuals often have access to private resources, while underserved populations remain reliant on public systems. “The government has to educate, the consumers have to listen, and the business is the engine that gets it going,” he said. Yet, without widespread education and willingness to adopt long-term strategies, progress will remain limited [1].

Cheng’s perspective aligns with broader industry concerns. Larry Fink, CEO of BlackRock, has similarly highlighted the urgency of expanding retirement savings to ensure equitable economic participation. Younger generations, in particular, express anxiety over the sustainability of retirement systems, fearing policies favoring older cohorts may leave them underserved [1]. This underscores the need for a collaborative approach to address the longevity gap.

Despite these challenges, Cheng remains cautiously optimistic. RGA’s dual exposure to mortality and longevity risks positions it to navigate demographic shifts strategically. While insurers must adapt to evolving consumer behaviors, systemic solutions—such as promoting financial literacy and rethinking retirement models—will be crucial. Cheng’s remarks reflect a growing consensus that longevity is not merely a demographic trend but a catalyst for reimagining how societies prepare for extended lifespans [1].

The path forward remains uncertain. With retirement savings disparities persisting and public resources constrained, individuals must prioritize long-term planning. For insurers, this means balancing risk management with proactive education to ensure longer lives do not translate into financial distress.

Source: [1] [RGA CEO Tony Cheng: Americans Are Living Longer—…] [https://fortune.com/2025/07/27/rga-ceo-warns-outliving-savings/]