Insurance companies take in huge amounts of money from policyholders.  Part of the purpose of an insurance company is to invest the massive amount of policyholder funds.

Much of the money is invested in bonds or fixed income, some can be invested in stocks or equities, and portions can be invested in real estate, hedge funds, venture capital, etc.

Two of the most daunting risks faced by the majority of retirees are:

A longevity annuity is arguably the most efficient way to insure longevity risk. 

Consider the following example to see why this is the case:

The UK pension market is in tough shape post financial crisis.

According to a Bloomberg article, "about 87 percent of the U.K.’s 7,400 final salary pension plans are in deficit following the financial crisis."

This crisis offers an unprecendented opportunity for companies that insure the pension liabilities of private corporations through bulk purchase annuities.