The transfer of longevity risk creates a growth opportunity for insurers who develop and distribute retirement income products, according to a recent study by Hartford-based Conning Research & Consulting.

But profitable growth depends on managing the risks associated with these products, according to a statement.

"The life industry has grown significantly during the past two decades by helping individuals accumulate retirement assets," said Scott Hawkins, analyst at Conning. "However, baby boomers are increasingly concerned about outliving their accumulated assets as they near or enter retirement.

Hawkins added: "At the same time, pension plan sponsors are concerned about managing their assets to meet their obligations to current and future retirees as life spans increase. The longevity risk concerns of both individuals and groups represent significant premium growth opportunities for insurers over the medium term."

"This transfer of longevity risk creates a tremendous growth opportunity for insurers who develop and distribute retirement income products," said Stephan Christiansen, director of insurance research at Conning. "Opportunities can be developed from exploiting differences in mortality of specific populations or groups, from fluctuations in specific age cohorts along the mortality/longevity spectrum, or from providing solutions to mismatches between investment and payment durations. However, profitable growth for insurers offering these products also depends on developing effective solutions to challenges of product distribution and on successfully managing the broad-scale accumulation of longevity risk within the insurer’s own portfolio."