On Longevity Insurance

Pantagraph.com discusses longevity insurance in a piece that provides more of the nuts and bolts details than my recent post on the subject at Fight Aging! "In its simplest form, the premise of longevity products is that by making a one-time payment, you will start receiving guaranteed lifetime income at a designated point in the future. Your projected income stream is calculated at the time that you invest. ... The insurance companies rely on the fact that people aren't going to live that long to provide the payouts to the select few that will ... financial planners were critical because the investments, while similar to annuities, carried high commissions and lacked some of the flexibility traditional annuities offer, such as inflation protection and return-of-premium benefits ... Insurers have since added some of these options. But such features add considerably to the cost, which leads critics to still question whether such products are worth the investment." And of course, whether these insurers are going to be ambushed by rapidly rising longevity in the old, thanks to modern biotechnology, and thus rendered unable or unwilling to meet their obligations.

Link: http://www.pantagraph.com/articles/2006/12/31/money/doc45970259ec07b165223006.txt

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