http://www.theatlantic.com/business/archive/2011/05/death-derivatives-has-wall-street-finally-gone-too-far/239091/

Yes, now if you are investing on Wall Street, you can bet on how long people live, to offset the costs of running a pension.  People living longer is a "longevity risk" that is counterproductive to the maximizing of profits on Wall Street.

The extra on in the subject header is typonese to make sure that things are really ON! (or whatever other lame excuse I can come up with for the typo I now can't change.

Technically, that is what insurance systems are entirely based on, including death, aka 'life insurance'. They base acturarial math on your likelihood to live to a certain age, minus a profit margin.

Has worked pretty well, no?

Well, if you're gonna die, you're gonna die. Might aswell let somebody get a bit of joy out of it.

Thats really not it. its essentially pension futures. It could play a valuable part in helping out the pension crisis by normalizing hedges against people or groups, thus ensuring that pension funds don't go bankrupt as quickly.

tbh, I didn't read it, I thought he was talking about Dead Peasant Insurance.

It is a variant of that, done a wider scale.  People take wagers that a pool of candidates will live within a certain age and pay out depending of whether they live  longer or not.