Could epigenetic testing be the future of life insurance? Foxo certainly believe so with its longevity SPAC agreement.
Foxo Technologies, which uses AI and epigenetics to underwrite life insurance has entered into a definitive merger agreement with special purpose acquisition company (SPAC) Delwinds Insurance Acquisition Corporation to form a longevity SPAC; this leaves the value of the combined company estimated to be $369 million.
Longevity.Technology: Although we have seen a tail-off in SPAC action, this transaction, combined with recent capital raising actions by FOXO, is expected to raise up to $224 million in total gross cash proceeds.
Angled as less invasive and more convenient than blood or urine samples, Foxo uses a saliva test to detect epigenetic biomarkers of health and aging in the body; AI-driven bioinformatics and DNA microarray technology then analyse the sample and give information on life expectancy, and it is this service that Foxo wants to bring to the global life insurance industry.
The longevity SPAC transaction, combined with recent capital raising actions by Foxo, is expected to raise up to $224 million in total gross cash proceeds, including up to $201 million of cash held in Delwinds’ trust account. Proceeds from the transaction will fund Foxo’s intended launch of proprietary products and services including life insurance accompanied by the Foxo Longevity Report that drive its distribution and services platform to create “Life Insurance Designed to Keep you Alive.”
Modernising Underwriting with epigenetics and machine learning
According to LIMRA International, an international research association for life insurance and financial services companies, a significant current issue in the life insurance industry is the lengthy timelines and invasive blood and urine specimen requirements associated with underwriting. Foxo, which is already involved in commercialising proprietary saliva-based epigenetic biomarkers, plans to create a simpler, smoother, non-invasive underwriting process. Foxo hopes its seamless saliva based underwriting process will provide enhanced protective value and represent a step-change improvement to the global life insurance industry.
Foxo’s proprietary epigenetic biomarker technology is designed to address the same underwriting questions blood and urine specimens address today. Epigenetic biomarkers are chemical modifications, called DNA methylation, that alter gene expression from external stimuli such as lifestyle and environment. Foxo derives epigenetic biomarkers by applying advanced machine learning to identify patterns of DNA methylation at over 800,000 (CpG) sites along the epigenome that correlate to measures of health and wellness.
Foxo uses micro-array technology developed and supplied by Illumina and machine learning technology developed and supplied by DataRobot to commercialize its epigenetic biomarker technology. Foxo is also responsible for developing technology that supports epigenetic science, including the Infinium Mouse Methylation Array, developed in partnership with leading technical experts, and the open-source bioinformatics software package MethylSuite.
Longevity science is fundamental to life insurance
Foxo’s services platform will allow insurers to personalise the consumer experience and – hopefully – support the healthy longevity of their customers by integrating molecular health and wellness into life insurance. Life insurers have a vested interest in being able to predict and measure the health, wellness, and longevity of their customers. By aiming to make longevity science fundamental to life insurance, Foxo hopes to enhance the core value proposition of life insurance by providing consumers immediate tangible value via its Longevity Report.
The Foxo Longevity Report provides consumers with insights into rates of biological aging based on the epigenetic aging clock developed by Dr Steve Horvath at UCLA. In addition to the epigenetic clock, the Foxo Longevity Report includes proprietary epigenetic-based wellness measures to inform health and longevity.
Jon Sabes, Founder and CEO of Foxo, said: “Our goal is to modernize life insurance by making advances in longevity science fundamental to the product itself. This transaction is transformative in our effort to support the industry’s effort to modernize in the face of accelerating advances in science and technology to reach more consumers at a time when interest in life insurance is at all-time highs .”
Brian Chen, PhD, Chief Scientific Officer of Foxo, said: “Science is beginning to accept aging is a disease that perhaps can be cured. Foxo is growing a portfolio of intellectual property around epigenetic biomarkers that correlate patterns of DNA methylation that measure individual rates of aging, health, and disease. Beyond using saliva-based epigenetic biomarkers to measure the very things life insurers use blood and urine to test for today, we intend to further consumers understanding of aging and what they can do to extend their health span .”