In October, Dan Finkelstein, a 37-year-old father of three, set out to explore buying life insurance. He went online, and to his surprise in about 20 minutes he was the owner of a $750,000 policy. Just a year ago, Mr. Finkelstein’s purchase would have taken a month and required blood and urine samples and other medical analysis. “I was definitely surprised how easy it was,” says Mr. Finkelstein, a computer-systems architect in Ellicott City, Md. ...
Life insurance start-ups are writing policies based on data pulled from digital sources rather than more costly and time-consuming sources such as lab tests. One such company, Haven Life, feeds into an algorithm information stored on databases for such things as prescription-drug dispensation and motor vehicle records to draw up policies. The company has a pilot program in which it uses the algorithms to help determine how much money people should pay out of their life insurance.