INNOVATION | 05.27.20
Earlier this year, a select group of technology developers exhibited their solutions as part of the Technology Innovation Lab at BISA’s Annual Convention. In the weeks ahead, you’ll meet some of these companies and learn how they are tackling some vexing problems and challenges that are unfolding at a pivotal moment for financial institutions.
Company Name: InterGen Data, Inc.
HQ: Plano, Texas
Product: Life Stage / Life Event (LSLE) Data, that is based on a suite of proprietary artificial intelligence (AI) and machine learning (ML) algorithms.
What it is: Life Event Data that includes; health and wealth data, analytics, expenses, and predictive modeling. InterGen Data’s technology uncovers, identifies, and predicts Life Events (health and wealth), expenses, trends, correlations, and provides that data to banks, financial services, and insurance companies.
Today, they can predict 12 out of the top 40 most impactful Life Events as well as 80 Critical Illnesses.
Challenge Addressed: Most Americans don't understand what it costs to achieve their goals, whether being able to retire when they want, endure a critical illness or ensure long-term care for a loved one. Research from the Charles Schwab 2019 Modern Wealth Survey shows two-thirds of Americans cannot afford an unexpected expense of $400 while most (59%) live paycheck to paycheck; and one-fourth of us do not have enough money for three months of living expenses. All of these financial preparedness gaps are being painfully exposed by the Coronavirus pandemic. Research from the Bureau of Labor and Statistics, meanwhile, shows that 40% of Americans would have to max out their credit card and/or borrow money to pay for a bill in excess of $1,000. Additionally, this research showed that out of the bottom quartile of wage earners; more than three-fourths do not have access to personal leave and more than half don't have access to sick leave.
In aggregate, this research suggests something perhaps uncomfortable for financial services companies to hear – that they could do a lot more to help some 200 million people. Today’s advisors just aren’t having tough-enough conversations with their clients about expenses, savings needs, accounting for things that might seem to fall under the banner of “unexpected” events (e.g. a critical illness).
Currently, all banks, financial services, and insurance firms deploy technology to facilitate a myriad of functions: financial planning; risk management; underwriting and compliance. However, these systems fail to account for the upcoming expenses of their client’s life stages/life events in an automated and/or data-driven manner. In turn, advisors are creating unrealistic expectations that clients can achieve their goals, whether they include retiring when they want, or setting aside enough money to endure a long-term care event. Our AI/ML algorithms overcome this gap with predictive analytics and visualizations that are specific to each client and/or their family as a whole.
How it’s Different: InterGen Data uses more than 130 million data elements to discover trends, correlations, and disparate data points that are unique to individuals. We also classify this information into four topical domains within a person’s life: Money, Work, Health, and Events.
Each of these domains, concurrent with Life Stages, brings both positive and negative events. However, it's the aggregation of these events – and understanding the order in which they are most likely to occur – that can dramatically impact financial planning.
Ultimately, life is a mix of good and bad, planned and unplanned. InterGen Data’s proprietary Life Stage/Life Event data helps advisors and their clients overcome “unexpected” financial hurdles by flagging them, their likelihood, timing and cost; estimating the true tally of realistic life expenses represents the next generation of personalized financial planning – done in a predictive manner.
Advisors seeking to differentiate their services can use these tools to have difficult discussions with your employees and clients about life and risk. Also to teach them how to prepare for life’s unexpected moments; educate them on how one critical illness increases the likelihood of another; and help them understand the “True Cost of Living.” And in what will be crucial for this stressful, seismic-change period we are all living though – these tools give advisors knowledge to lead the way into a “New Financial Normal,” removing guesswork out of the planning process.
Core Beliefs: We believe that when people are provided with the right information, they will be able to better understand, plan for, and make the right adjustments for their future. Like navigational tools Waze or Google Maps, our aim is to help you see what’s ahead in your financial journey.
Elevator Pitch: InterGen Data has developed proprietary AI/ML algorithms that predict and identify when clients are likely to have an important Life Event occur, what it could be, and how much of a financial impact that it could make. We uncover hidden risks and previously unknown hurdles in your client’s financial roadmap.
Why Now: COVID-19 has forever changed how we will do business. More importantly, it has heightened the need to understand upcoming costs, especially healthcare related ones. For example, “co-morbidities” (diseases occurring simultaneously) play a tremendous role in who is likely to die from and/or recover from this virus. Today, we can predict 80 Critical Illnesses and can associate this data directly to each client. We believe that by doing so, firms can better understand what expenses are likely to occur and help their clients.
Let’s face it, people don't understand how to think about or plan for the unknown and this is where the problem grows exponentially. The rise in COVID-19-related costs in America could bankrupt millions.