Wearable devices: invasion of privacy or health necessity?

Wearables are everywhere – from the premium Apple, Garmin and Fitbit brands, to the free smartphone apps and entry level step counters that line many a stocking at Christmas.

Creating a healthy rivalry in households across the country, people are now tracking their daily step totals and paying more attention to keeping active. Having been projected to see growth of almost 20 per cent in 2021, Gartner predicts that the amount of wearables sold will reach 453 million this year.

A staggering number of people are already recording their own health statistics, from heart rates to sleeping habits. The insurance industry wants the opportunity to tap into this data – offering a more personalised insurance based on the individual habits and needs of the policyholder. Though a traditionally change-resistant sector, insurtech partnerships are increasingly aiding such innovations.

In 2017, Alphabet (Google’s parent company) signed up 10,000 volunteers to wear a Verily health tracker (Study Watch) and have their health data tracked and analysed. The multiple-year study, named Project Baseline, looks to find out why people transition from being generally healthy to getting sick. The goal for the study, said Verily co-founder and chief medical officer Jessica Mega, is to “create a map of human health”.

>See also: The future of tech in healthcare: wearables?

Google’s previous attempt to enter the insurance industry ultimately backfired in the fiercely competitive UK price comparison website market. However, for Project Baseline, pharma companies are also working with Alphabet on a variety of life sciences initiatives, including ongoing research into COVID-19.

Reluctant customers

In the world of corporate data breaches and cyber attacks, it’s no surprise that people are reluctant to give organisations access to their personal data. There needs to be a guarantee that this data is safe, protected and won’t be sold onto other providers for marketing purposes.

The fallouts of major cyber attacks such as WannaCry demonstrate the understandable public outrage that emerges when personal data is exposed – something insurance companies are wary of when storing medical data. Perhaps surprisingly, Altus research showed that insurance companies actually fared better than technology companies when it comes to who are most trusted.

Coupled with the data breach concern, there is also the worry that premiums could go up unexpectedly. Perhaps you’ve had a stressful few weeks at work; your cholesterol levels are up, you’re not sleeping as well and you’ve not had a chance to pop to the gym recently? What does this mean for how much you have to pay, for now and the rest of the year?

Benefits of wearables for the policyholder

Structured health insurance products that provide a heavily discounted wearable device alongside the insurance policy are a viable option. In exchange for consumer data and an exercise plan that ensures customers are staying fit and healthy, insurance companies will keep premiums low – much in the way that a driver with no-claims will hopefully see a lower renewal premium.

With wearables, you can tailor your insurance so that it is suited to your individual health needs, meaning you’re not paying out to protect yourself against things that are unlikely to affect you.

Ultimately, using wearables means there will be fewer claims overall, which is a great business model for all parties. This new technology could help medical insurance act as a risk prevention – instead of merely a risk resolution. What’s more, having a device to help monitor your wellbeing wherever you are is proving useful with the rise of remote doctor’s and hospital appointments through the pandemic and beyond. This can lead to accelerated claims processes.

>See also: How will wearable technology change the insurance industry?

What next?

Dangling a carrot of free technology is a way to engage customers, but protection is vital should wearable technology be compromised. This data isn’t simply name, address and payment details, but potentially highly personal data about an individuals’ wellbeing.

The insurance industry will need to develop solutions that help protect the policyholder, and reassure the individual that their data is secure. With GDPR, UK-GDPR and other regulations globally to be highly considered, insurers are spending considerable time and investment in ensuring data is well protected.

The ubiquitous nature of wearables has helped increase engagement with insurance, and customers have been introduced to the numerous health benefits of using these devices.

If you’ve already got a device tracking your wellbeing, why would you not want a doctor also doing the same? By becoming an extension to the wearable itself, wearable insurance is likely to be generally accepted by customers.

Sourced from Mark Andrews, insurance director at Altus Ltd


Q&A: the impact of big data on the insurance industry — Dan Keeley, head of data engineering at challenger insurer hubb, spoke to Information Age about the impact that big data has on insurance.

The exciting future of remote health monitoring depends on learning four lessons — David Hancock, healthcare executive advisor at InterSystems, identifies four lessons to be learned from remote health monitoring.

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