The correct answer is D. Investment risk.
A pension is a fund set aside by an employer or an individual to provide income in retirement. The amount of money in a pension depends on a number of factors, including the employee’s salary, the number of years they have worked for the employer, and the investment performance of the pension fund.
Health is a major contingency that can affect a pension. If an employee becomes ill or disabled, they may not be able to work and earn a salary. This can reduce the amount of money they have saved for retirement and make it difficult to maintain their standard of living.
Longevity is another important contingency. People are living longer than ever before, and this means that they will need to have more money saved for retirement in order to cover their expenses. If an employee lives longer than expected, they may run out of money in their pension fund.
Inflation is a measure of the rate at which prices are rising. If inflation is high, the value of money decreases over time. This means that the money in a pension fund will not be worth as much in the future as it is today.
Investment risk is the possibility that an investment will lose value. This can happen for a number of reasons, such as a decline in the stock market or a change in interest rates. If an investment loses value, it can reduce the amount of money in a pension fund.
Therefore, the correct answer is D. Investment risk.