The Surprising Way Wearable Technology is Changing Insurance

The Surprising Way Wearable Technology is Changing Insurance

The era of wearable technology is now. Smartwatches, fitness trackers, smart glasses, Bluetooth headphones, and even implants are the norm in our world. Technology is already integrated into our everyday lives; our phones know us as well as our friends. We carry it around everywhere we go and often even wear it. Our devices see our searches, our locations, and our activity levels without us even thinking about it, and the health care industry has caught on. They have recognized that technology can analyze us, without inconvenience, and detect things we may not have picked up on. So, while we may stretch the truth on our activity habits or not notice irregular heartbeats at our next physical, our devices can tell all.

As an insurance agent, you are always looking for ways to help your clients get the best deal in terms of coverage and costs. And while technology is nothing new to our society, it can be intimidating to adapt and rely on new devices when we are so used to the comfort of a doctor. But the benefits of consistent monitoring, early detection and prevention, and the accuracy of these products may be worth a try. A lot of changes will be developing rapidly in the medical tech world and here’s what you should know.

Interactive Insurers

In the past couple of years, we’ve seen the industry incorporate wearable technology into their policies that even major carriers are adapting.

  • John Hancock only sells interactive life insurance policies where policyholders can earn discounts and rewards for reaching exercise goals
  • Fitbit has deals with Humana, Blue Cross Blue Shield, and UnitedHealthcare to offer devices and wellness management programs for the insured
  • Aetna more recently opened a program (Attain) which pays off your Apple Watch as you reach personalized health goals each month
  • Peer-to-peer insurance companies will often group together people who have similar lifestyle habits based on their wearable technology data

It has become apparent that the industry is leaning towards using wearables as a way to improve health and attract customers. Staying up to date on which carriers offer technology incentives could help you attract clientele.

Government Health Programs

Diabetes and obesity are a global concern, even to the point where governments are stepping in to help the health of their citizens. Singapore’s Health Promotion Board intends to work with Fitbit to promote healthy living of their citizens. The plan is to allow citizens to have the Fitbit Inspire band when they subscribe for a years’ worth of premium coaching services, from Fitbit, for $10 per month. The objective of this program is to help combat the countries concerns in public health, specifically diabetes and heart disease.

It will be interesting to analyze how the program affects Singapore’s health and the potential for similar projects to spread to other countries. Knowing that cardiovascular diseases are the number one cause of death in the US, stemming from a 1 in 4 statistic, an initiative like this may be beneficial.

Benefits

Using healthcare wearables will give users an array of different benefits. While using wearables the devices will be able to monitor and track abnormalities in our bodies such as blood pressure or heart rate. This will allow for the user to be alerted and take the appropriate action, whether that be to calm down or go see a doctor to prevent escalations. Of people who have had cardiovascular deaths, it is estimated that 47% were not in the hospital insinuating that early warning signs were ignored. In addition, wearables will incentivize healthier habits by tracking activity, sleep, eating habits, and heart rate that could help prevent potential health issues. These factors will theoretically bring down insurance premiums due to the steps your clients are taking in being held accountable for a healthier lifestyle. This is why so many insurers are offering discounts or rewards to use their wearable programs.

Regulations

Of course, big data has become a rising concern for the public in terms of privacy, and this skepticism has transferred over to the wearable tech industry. The accuracy of wearables is dependent on the fact that clients use them for every part of their daily lives, allowing it to gather information about us like never before. Yet regulations on wearable technologies are underdeveloped relative to the extent they are expanding across the healthcare industry. The FDA does not classify wearables as medical devices which means the FD&C Act, which protects against such devices, will not regulate or require compliance. In fact, current regulatory acts do not fully regulate wearables beyond providing a baseline for transparency and disclosures. As of now the California Consumer Privacy Act is set to go into effect January 2020 and will allow people to stop companies from selling their information upon request. This act could start a movement towards stricter regulations which your client may find favorable. However, regulating data on technology is difficult and the scope of protection still may not be as secure as most consumers perceive. With that said, people have become more willing to share their information when it comes to bettering their health, especially when it comes to those who are already diagnosed with chronic diseases. Additionally, the majority of patients would be willing to share their data with their doctors as opposed to anonymous companies.

As wearable tech is still growing, the usage may not seem appealing to most, but it is projected to be a commonality in the near future. As an agent knowing the details of this trend could be beneficial to your client who may be the ideal contender for this type of insurance. Make sure to be on the watch for changes in regulations and usage of such devices by following our blog.