Those born from September through November tend to live to 100 more than those born at other times of the year.
The number of persons reaching age 85 should more than triple to 14 million from 4 million today, according to a study by William Mercer, a Chicago-based benefits consulting firm. In addition, modal ages for death-the ages at which the largest number of people die-have continued to increase and are now in the late 80s for many populations, says Chris Bone, the actuary with Edith Ltd. LLC, Flemington, N.J.

So many believe there may be a place for longevity insurance as part of a comprehensive financial plan. Northwestern Mutual, Milwaukee, for example, launched a retirement planning program dubbed "The Northwestern Mutual Retirement Strategy" to address those issues.

Its retirement plan strategy includes a single premium deferred income annuity as well as long-term care insurance and planning for investments, inflation, taxes and estates. John Grogan, Northwestern Mutual senior vice president for planning, says plans should assume people live beyond their life expectancies.

There is a 25% chance that a 65-year-old man will live to age 94, a 65-year-old woman will live to age 95, or at least one spouse of a 65-year-old couple will make it to age 98.

Say a 60-year-old male could invest $500,000 of his retirement savings in the deferred income annuity. He would get $43,094 annually when he retires at age 65.

Matthew Grove, vice president of retirement income security with New York Life, says financial advisors are giving immediate annuities a second look as a way to reduce the risk that a person will run out of money. As of the end of June, over $500 million has gone into New York Life's "Guaranteed Future Income Annuity," a deferred fixed immediate annuity, since it was issued in August 2011, he says.

The core audience for this annuity is pre-retirees between the ages of 55 and 65 who plan to retire in five to 10 years, he says. Approximately 66% of the insurer's purchasers are funding the annuity with tax-qualified money, which is money they already had in IRAs or 401(k)s and had set aside for retirement.

Grove says two of three policyholders in non-qualified accounts are selecting a start date prior to age 70½. One of three opts for payments to begin between 70½ and 85. In traditional IRAs, required minimum distribution rules require all purchasers to elect an income start date prior to age 70½.

Typically, individuals select a cash refund so a beneficiary gets the remaining cash balance or a joint-and-survivor payout. "We believe the purchase pattern that we see in our non-qualified sales indicates that there would be even more interest in the Guaranteed Future Income Annuity if an income start date were permitted beyond the age of 70½ for qualified savings," Grove adds.

Meanwhile, Bennett Kleinberg, senior actuary in MetLife's retirement division, says that some financial advisors put about 10% to 20% of their 50-year-olds' assets to the insurer's "Longevity Income Guarantee" annuity. The average policyholder has a net worth of $500,000 and invests a lump sum of $60,000.