Following a devastating fire in Colonial Philadelphia, Ben Franklin co-founded the first American property insurance company in 1752. Then as now, the role of an insurer was to collect sufficient premiums to cover losses over time. Franklin established premiums based on the estimated risk of loss assigned to each property, with riskier enterprises charged higher rates or refused coverage outright.
For 250 years the tools of the insurance trade remained essentially unchanged: actuaries, underwriters, adjusters, and sales agents evaluate available information, issue policies, and pay claims. What has changed is a supernova of data and the sophisticated computing power to process this mother lode. The industry is undergoing a revolution based on the ever-expanding digital profile of your life that portends greater profits for the insurers and better products and services for you, but at the cost of further erosion of personal privacy.