Life and health insurance prolonging lifetime
The insurance structure undergoes major reconstruction. Besides the digitalisation and implementation of the mobile applications, life insurers are looking for new solutions to attract and maintain clients.
In an attempt to revitalize the stagnating industry, insurers are about to change the perception of life insurance from the mortality reminder to longevity opportunity. When wellness sector is gathering momentum, insurance companies try to infiltrate in the trend.
The combination of healthy and wealthy lifestyle with insurance is the next step for the industry development. Some companies already cooperate with wellness centers. Until the recent time, the life insurance has reminded everyone that we all going to die. And no one wants to think about coming end. Life insurance starts to modernize itself attracting the younger population. On the contrary, the future decade will transform the approach promoting living and increasing healthy standards.
How will insurers implement the new strategy? Using the new technologies and new digital behavior of the population. Wearables ability to make one fitter and to fight global obesity has been discussed in the previous article (click here to read Will the wearables make the world more active?). Insurance companies intend to combine wellness and technological obsession to track customers FitBit data in exchange for a discount on their premiums. In the real life, it will mean that each client will have an opportunity to get bonuses for following the healthy lifestyle advice. For instance, regular workout three times a week or an advanced workout twice a week will grant the client with points, which later on will be transformed to the discount. Similarly nonsmokers and people following the healthy diet (having cholesterol and glucose indicators in the norm, for example) will get points for each point.
John Hancock Insurance together with Vitality, the leader in the interactive, personalized wellness programs, presents a new approach to life insurance. The core idea is to reward the clients for a healthy living. When joining the program, participants take the age vitality test, identifying how old is the body based on the mood, diet, and the current lifestyle. Results are followed with the individual yearly plan how to improve the score. Each participant receives the FitBit bracelet to keep track on the daily activities and informs the insurance company of the success. Also, clients will have access to the online healthy living courses. In exchange, customers receive bonuses and discounts to their premiums.
In future, similar insurance policies will influence the pricing strategies turning it to the individualized and customized charging methods. There is no doubt that the clients will take advantage of the methodology. Nevertheless, the outcome must be beneficial for everyone. Read more about Personalised and dynamic pricing here.
Another trend to follow is to provide the customised and personalised packages for the customers. Empowering the client to choose himself and customize the insurance policies for the individual needs is an important feature, which clients expect from the companies. Moreover, the choice of additional wearables to control the health indications and to share the data with the doctors and insurance companies at the same is the new opportunity to lower the price of the premiums. The packages can be enlarged for the whole family members, and include even the home pets.
With the development of the internet and cloud systems, the question of privacy arises in every possible topic. The insurance companies implementing the wearables is not an exception. To gain the reward, policyholders will have to fill rather sensitive questionnaires identifying their habits and mental state of health. Not everyone feels comfortable to provide personal information continuously to meet certain thresholds to gain the rewards. Additionally, the wearables like FitBit will track personal location, hours spend in the gym or jogging pace and distance. Nonetheless, nowadays people report to be interested in personalized offers and ready to give up part of private space in exchange. In future, when the risks of invasion of privacy will grow, the social reaction is unpredictable.
Let's imagine that these new insurance products will achieve high success and interest from all over the world. We would expect increased percentage of healthy people and new longevity records. Moreover, even those who will not participate in the program will be influenced by others and join the worldwide wellness trend. Consequently, the world's environmental and sustainable awareness will trigger the demand in clean technologies and green solutions. The big share of privacy will be lost and personal information will be shared to the insurance companies, corporate structures, and state agencies on the higher level.
Enterprises will incorporate the life insurance methods making the vitality age as a competitive factor when hiring new employees. Also, this factor will be the reason for losing the working place. The employee will demand the wellness programs from the companies respectively. But should one's lifestyle interfere with the professional skills?
Moreover, in this scenario, we will see rough society split between people with higher income having healthy wellness lifestyle and people with chronical or congenital diseases or society with low income. This will give a birth to new inequality and negative externalities on the society.
Life insurance industry opens new horizons implementing new technologies and take as an aim celebrating the life and encouraging healthy behaviours to rule that calculus in their favor. However, new products raise the questions of privacy, pricing and equality. Another uncertainty is whether new strategies will attract only healthy people and fail to develop itself.