Mostly as a data aggregation exercise, saying something like: “If we get enough of the right data we can price any uncertain process.” see for example this a16z.
This is only one half of insurance, however, and ignores underwriting, or the detection of moral hazard.
In gambling terms, insurance is a bet that people are making at a table where they are the dealer. For most circumstances interests are aligned, which is why insurance works most of the time. But underwriting exists for a reason.
Now I’d be dismissing the Disruptors too easily if I left this argument here. They make their living proving insiders who lean back in their chair sounding smart wrong.
Some consumer lines are very data driven, like auto and homeowners. But these are stifled with regulation and incredibly competitive anyway. My understanding is that at least one venture backed startup in online distribution has fallen down on regulatory concerns. A tough industry to disrupt.