ILS in personal risk is still an infant but promises to be an alternative to conventional personal insurance products. Here's how one may apply ILS in the coverage of individual risks:
1. Life and Health Risk For other forms of ILS, such as mortality and longevity bonds, the technology for communication of the risk associated with mortality and longevity was already available. The same paradigm can be used to depict customized life and health coverage. For instance, an investor purchases a longevity bond. If the investor lives long enough to attain a certain age, the bond makes a payment, this being a sort of an annuity or life insurance type of product.