Methodology changes impact historical numbers and, therefore, historical trend comparisons in subsequent press releases. Note that all published press releases reflect the Life Index as calculated for that moment in time; published numbers are not re-stated. All current and historical values used in calculating the monthly Life Index press release reflect the most current methodology at the time of release.
Effective January 2017, MIB reset its benchmark comparison (basis=100) for the MIB Life Index from January 2001 to January 2011. The reset to a more current benchmark ensures that the MIB Life Index values are not biased from cumulative and exogenous historical market factors such as industry consolidation, economic shocks and/or regulatory changes occurring since 2001. To maintain the Life Index as an accurate, contemporary measure, adjustments to the basis will be made every five years.
The change in the basis for the MIB Life Index has no effect on the historical percent changes reported to the public in the monthly press releases or the mid-year or annual reports. These reports are based on a rate of change over different time intervals which is independent of the index value.
An example of the impact from the benchmark adjustment can be seen in the Life Index values for life insurance applicants age 60+. Using January 2001 as a basis, and owing to long-term growth of sales in this age group, the Life Index value for this age group in 2016 was approximately 200. Changing the basis to January 2011, effectively adjusts the ages 60+ index value to around 125. Recalibrating the Life Index basis reduces any potential distortion in trends for this age group relative to other age groups.
MIB has plans to expand the scope of the Life Index to include more than the age group comparison it currently publishes. An updated basis permits new groupings to be grounded on a contemporary basis that reflects more recent industry activity as the baseline.