Life Insurance

New Health Metrics in Life Insurance

A new measure of fitness and health, called Personal Activity Intelligence (PAI), has important implications for both life insurers and their policyholders.

It's now possible to predict, using new technology, the chances that consumers of all ages will develop cardiovascular disease. Even better, if the data from the new technology shows improvement, there is also a chance to lessen the potential health risk.

Digital technology applications offer life insurers the chance to engage customers with personalized health data that's both simple to provide and simple to understand. And, obviously, this is a win for life insurers, too – customers with personalized health data receive more value from the relationship. After all, enabling healthier, longer lives means a longer lifetime value to the benefit of the policyholder and the insurer.

The secret to personalized health data

There is really a secret to this personalized health data, which is according to cardiorespiratory fitness (CRF). CRF is among the best predictors of health and mortality, with a direct correlation between cardiorespiratory fitness and lifestyle diseases.

Until now, CRF has been the missing link to quantify the level of physical activity required to lessen the risk of lifestyle diseases. In England, healthcare costs related to physical inactivity are five times more than smoking, as well as in the U.S. $117 billion health care expenditures each year were associated with inadequate levels of physical activity.

Health data analytic companies, for example PAI Health, offer solutions to make CRF data accessible and relevant to insurers and consumers alike. Customers' activity levels and CRF data are tracked using a personalized baseline risk assessment. Dynamic, real-time risk monitoring improves customer engagement and reduces risk. Insurers are therefore in a position to determine the level of risk and understand the health profile for individual customers.

Shifting the conversation from payer to partner

Think of how providers currently handle the customer relationship. Once a customer purchases an insurance policy, the communications typically become almost entirely transaction-based, focused on renewals and claims. What if an insurer had access to data insights that assess customers' health and risk levels dynamically over time? This now opens the door to a personalized health dialogue.

One of the largest life insurance companies saw this opportunity when it just entered into an agreement to provide its policyholders with wearable digital devices and gain their customers' health and fitness data. The insurer will offer rate discounts and other incentives to its policyholders, creating a conversation between the company and its customers about fitness and health.

By using CRF metrics and personalized health data, software tools present complicated data in a comprehensible format for the first time. Here is exactly why tracking this valuable CRF data isn't only the best approach for insurers, but also is extremely important in the future of health:

  1. It takes the guesswork from health: Innovations in biometric algorithms help make big data simple enough for anyone to understand. The data that originates from these algorithms is also personalized for anyone of any health level. It offers the chance to meet people where they're, inside a more open and understanding environment, to obtain them started on the path to a longer, healthier life.
  2. It's educational and accessible: For most customers, the idea of changing their lifestyle could be daunting. CRF metrics could be a conversation starter opening the door to educational content that naturally supports the transition to a healthier lifestyle, making the entire process less intimidating for customers. What's more – it's extremely accessible and convenient, because all a customer must do is take a minute from the day and get started via smartphone.
  3. It's universal and trusted: Health isn't one size fits all, but the beauty in CRF metrics such as the Personalized Activity Intelligence (PAI) is that they work with customers at any health level with whatever type of exercise they prefer. And what many customers don't realize is they are becoming healthier through daily habits, for example mowing the lawn, washing the car or doing housework. By using an activity metric underpinned by CRF, you are providing customers with data that's trusted by the AHA, NHS and sports science experts as a proven measure of health.
  4. It fits real life: CRF activity metrics have a holistic look at improving activity, instead of looking day by day. What this means is if a customer misses each day or needs a break, it's not the end of the world. The activity prescription provided to the individual readjusts and the risk models update, so the individual can stay motivated around the journey to his or her best self. Improving CRF is a physiological adaptation that requires continual work, which is exactly what the data molds to.
  5. It doubles as a measure of health: As an insurer, it's important to know the health levels of person customers. A simple score tells the insurer and its customers exactly where they're, to attain optimal health. The information might be incorporated into rates and underwriting.

The time is now to start engaging customers inside a dialogue using personalized health metrics that can lower risk and costs, while adding more to the relationship.

Through this data, insurers and policyholders alike have a new opportunity to advance the way we monitor and act on health, to assist customers enjoy happier, longer lives.

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