It’s not exactly news that is little truly innovative work going on in the life insurance business, particularly when you compare it to what is taking place in the P&C market, but Jon Sabes, CEO of GWG Life may have come across something special in the research conducted by Dr. Steven Horvath. That’s how ITA Pro magazine described GWG Life’s epigenetic insurtech project in its March issue.
“A key piece of our business is a quest to better under-stand mortality and longevity,” Sabes told ITA Pro editor Robert Regis Hyle. “In order to be better at our current business, we are looking for technology that will empower us. It was through that search that we read about the research going on in human longevity and we came across Dr. Horvath and his publication on the biological clock.”
Dr. Horvath is a professor of human genetics and biostatistics at UCLA and in 2014 wrote about his work on the biological clock, according to Sabes. He wrote about all-cause mortality and its relationship to the biolog-ical clock.
“So many times researchers are working on clinical applications rather than actuarial or probabilistic aspects of the research and this struck him quickly as an application for the biological clock, or some version of his research, which could be applicable to life insurance,” says Sabes. “That set him off on his quest to develop the tool we were looking for—a pre-dictive analytic that he published in September of 2016.”
In August of last year, Dr. Horvath told Sabes he had completed a meta-analysis and developed an all-cause mor-tality predictor. In November, GWG Life, signed an exclusive license for DNA Methylation technology developed by Dr. Horvath, which analyzes genetic material from blood or saliva to achieve a more accurate—and cheaper—way of predicting lifespan than the traditional method of blood analysis and medical reviews.
“That research paper had hazard ratios based on what he called age acceleration factors,” says Sabes. “We have worked since that time to translate these hazard ratios into actuarial language. We’re still in the process, but we’ve made progress.”
Sabes explains it is not difficult to do a fairly straightfor-ward translation from a hazard ratio into a mortality factor. GWG has worked with actuarial scientists on this to confirm the methodology and Sabes is pleased with where they are at in terms of turning the science into an application.
As far as testing his theories, Horvath obtained samples of genetic material on 13,000 individuals who have been followed for decades. Within that pool there were over 3,000 mortality events, according to Sabes.
“He identified the bio-markers that predicted those with higher incidences of mortality. In effect, he back-tested it and that’s how the bio-statisticians solve these bio-markers,” says Sabes. “One thing that is important to point out here is we’re not looking at DNA. DNA looks at a gene that is either on or off. We are looking at the epigenome and the methylation sites.”
According to Sabes, Dr. Horvath studies these methyla-tion levels that change over time, no different than your blood pressure or your cholesterol. These levels change based upon what you eat, what you think about, what chemicals you are exposed to, and whether you smoke or not. Scientists run an regression analysis that can draw a line for someone who has these bio-markers to determine if they have higher degrees of aging or a lesser degree.
Those bio-markers correlate to earlier than expected or later than expected death,” says Sabes. “What is surprising is they study how you age and also when you die. It was the back side of the research we were looking at.”
As much as longevity has been increasing, Sabes believes we are starting to see some upper limits, although many scientists believe they will make more breakthroughs with people living much longer. But body parts just wear out and that is what Dr. Horvath is measuring vs. specific disease cures or step changes in overall longevity due to scientific breakthroughs.
“It’s not one thing that kills you; it’s everything—the compounding effect. What Horvath will tell you is your envi-ronment matters. At about age 30, the trajectory of your age acceleration factors is such that it is hard to make a dramatic change,” says Sabes. “Think about the compounding effect on your life by age 30. You can’t eat enough kale or exercise enough to change the all-cause mortality profile.”
GWG Life is looking for a way it can enhance the overall efficiency of underwriting. Sabes feels if the industry can get out of the para-medical exams and do less with medical records and more with mortality profiles, the data can benefit the life insurance industry.
Currently, GWG is evaluating the business model they want to deploy. The insurer is working with some existing sci-ence partners to commercialize the test and make it commer-cially available as well as evaluating different business models with it. The testing might also prove interesting to the annuity space, where. 95 percent of annuities are life contingent, according to Sabes.
“It may be a testing/information service, it may be partner-ing with other carriers to enhance or augment their under-writing protocols, it may be that we enter the market as a new entrant into life insurance with a new model of underwriting,” says Sabes. “We’re going to continue to move quickly with the commercialization of the testing and we’re excited to bring it to the industry and be relevant from a technology innovation perspective.”