GAD uses actuarial modelling to support pandemic preparedness
GAD modelling explored how uncertainty in vaccine development could affect pandemic response decisions and their economic impact.
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The Government Actuary’s Department (GAD) worked with the UK Health Security Agency (UKHSA) to explore how uncertainty in vaccine development could influence the economic consequences of pandemic response decisions. This included uncertainty in development timescales and the number of vaccine candidates.
Building on wider preparedness activity, the proof of concept combined scientific input, economic evidence and actuarial techniques to demonstrate how a range of possible outcomes could be explored, rather than relying on a single estimate. It showed how actuarial modelling can help decision-makers understand uncertainty and quantify risk.
The ask
The UK’s pandemic preparedness strategy emphasises the use of analysis, scientific evidence and expert advice. UKHSA asked GAD to test whether actuarial techniques could support understanding of uncertainty in vaccine development and help frame its potential implications for the UK economy.
This was exploratory work. It was designed to demonstrate a modelling approach, not to recommend a particular response or replace the scientific, operational and policy judgements for which decision-makers remain responsible.
What GAD did
GAD and UKHSA developed a simplified, hypothetical model to explore how uncertainty in vaccine-development timescales could interact with the economic effects of pandemic response choices. UKHSA brought public health and subject-matter expertise, while GAD designed the modelling approach and interpretation of risk.
Drawing on expert input and desk-based research, GAD represented a sequence of uncertain vaccine-development milestones and tested many plausible pathways through them. The model then linked the resulting timescales to a measure of potential economic impact.
Rather than producing a single forecast, the analysis generated a distribution of outcomes. This allowed the team to examine central estimates, less likely but more severe outcomes, and the assumptions that had the greatest influence on results.
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How GAD added value
The actuarial approach made uncertainty explicit and connected it to consequences that matter to decision-makers. It provided a consistent framework for comparing options, testing sensitivities and showing how new evidence could change the assessment of risk.
The work also illustrated the importance of diversification: relying on fewer vaccine candidates could increase expected development times. Such delays could lead to higher economic costs.
The value of actuarial analysis
This project showed how actuarial modelling can complement scientific and economic analysis in pandemic preparedness. It can quantify uncertainty, compare possible outcomes and highlight concentration risk, helping decision-makers consider trade-offs and the implications of emerging evidence.
“GAD worked closely with UKHSA to deliver a useful and clearly presented piece of analysis within a challenging timescale. The team helped sharpen the focus of the work, communicated clearly throughout the project and produced a valuable output for us. We were impressed by the team’s technical expertise and would welcome opportunities to work with GAD again in future.”
Michael West, Deputy Chief Economist, UK Health Security Agency
Supporting future decisions
The analysis was a hypothetical, non-advisory proof of concept. Further research, validation and assurance would be needed before adapting the model to support live decisions.
As evidence develops, a future model could be updated to reflect observed development times, changes in the number of vaccine candidates and revised economic assumptions. This could show how the risk picture changes and help communicate complex information in a form relevant to decision-makers.