On the horizon: tech gains that enable cradle-to-grave planning

Exponential gains in information technology are transforming the insurance and financial services business. The advances represent a threat to advisors whose services might easily be automated. But for those who boast strong relationship-based skills, the tech gains could be a boon for their practices.

That was a key theme of a Friday morning session, “Mapping the Future with Big Data,” at the Retirement Income Industry Association’s 2015 Annual Conference in Indianapolis. Co-presenter Anand Rao, a partner in PwC’s Advisory practice, explored how IT advances are transforming industries and products, including medicine, self-driving vehicles, facial recognition tools, investment advice and financial planning.

A look back

Rao said a key factor to weigh in retirement planning, life expectancy, has been following a non-linear path. In 1541, average life expectancy was to age 35. It took another 300 years (to 1895) to reach age 45. But in just the last 100 years, life expectancy it has nearly doubled in some advanced economies. (In the U.S., average life expectancy is 79.)

The trend, driven by technological improvements in sanitation, medicine and other health-related factors, represents an exponential increase in longevity. This growth trajectory is now fueling other technology-related medical advances.

Prime example: DNA sequencing, a process used to determine the order of four nucleotides or bases — adenine, guanine, cytosine and thymine — that make up an organism’s genome or DNA dataset. DNA sequencing of the first human genome, said Rao, required an investment of $100 million over eight years.

Today, an individual’s genome can be deciphered for just $3,000. Parts of DNA can be sequenced for as little as $99 over three days using DNA taken from a saliva swab.

This quantum leap in the technology, said Rao, is evidence that Moore’s Law — a doubling of computer power every 18 months thanks to advances in chip technology — remains a principal guideline for forecasting tech-fueled gains.

Turning to gene therapy, Rao said the ability replace damaged genes with healthy ones using gene splicing — a process analogous to cutting and pasting text in Word documents — has enormous implications for arresting cancers.

Microbiologists are experimenting with the technique on multiple genes to better understand how they act in concert, and to develop treatments customized to an individual’s genome.

Medical advances, said Rao, are also being enabled by the development of “organs-on-a-chip:” microchips lined by human cells that could revolutionize drug testing and development. A pioneer in this space is Wyss Institute, where multi-disciplinary teams of researchers are engineering microchips that emulate the architecture and functions of living organs, including the heart, lungs, liver and intestines.

Exponential gains in technology can be seen, too, in hardware and software powering self-driving vehicles. In 2004, said Rao, participants in a challenge sponsored by the Defense Research Projects Agency (DARPA) competed to develop a self-driving car that could complete a 750 kilometer race. The winning vehicle managed to go only 7.2 kilometers.