Imagine a Completely Different Model for Life Insurance Coverage

It has been done, and Umbach says a social network like Facebook has the potential to reinvent the way people obtain something akin to life insurance coverage. Could it emerge as a successful new model before states could define and regulate it as insurance? When I think about what Napster did to the music industry, I wouldn't rule it out. Here's a brief excerpt from Umbach's article:

Facebook and other forms of social media have three key elements that are required for insurance to work:

1. A large, diverse pool of people.
2. The ability to track and store large amounts of data and make predictions from it.
3. Awareness of the burden of uninsured risks.

And it has four things that today's insurance industry does not have, but probably wishes it did:

1. Significant levels of involvement and engagement by users.
2. Viral marketing power.
3. Instant feedback about what people like, dislike and what is attracting the most attention at any given moment.
4. A natural hedge against anti-selection.

Could forces outside the insurance industry "jar" — like Facebook joining forces with AT&T and PayPal — actually pull this off? I don't think it's on their "to do" lists at the moment, but who's to say someone in a position to make forces like these align doesn't at least have it on the radar?

Twenty years ago, who imagined iTunes would be the way you bought music?