Insurance has long served as society’s safety net, providing financial protection from unexpected, often life-altering events. Whether supporting individuals, families, or businesses, insurance plays a critical role in weathering life’s storms.
But can the insurance industry, and specifically the life and health sectors, do more? Can insurers move beyond their traditionally reactive role to pursue strategies that proactively mitigate damage from life’s storms or even prevent them from occurring? With access to new data sources, improved tools and technologies, and a greater understanding of human health and wellness, the life and health industry has a unique opportunity – and a responsibility – to do exactly that.
This requires engaging consumers at a whole new level – as an active partner in promoting their overall wellbeing.
“Wellness” is a term familiar to anyone working in life and health insurance at any point over the past 20 years. Originally focused on monitoring physical activity through steps measured by pedometers and wearable devices, insurance-linked wellness programs have expanded to include disease monitoring, mental health services, and more. These advances can produce positive results for policyholders through improved quality of life and for insurers through greater consumer engagement and healthier portfolios of insured lives.
The term “wellbeing” extends the concept of wellness. Promoting wellbeing means adopting a holistic approach and considering all aspects of a person ’s health – including physical, mental, financial, and social.
Insurers promoting wellbeing seek to develop products that support insureds as well as those around them, such as eldercare services that meet the needs of both older adults and their caregivers. The focus on wellbeing expands the traditional role of insurance (financial protection) into an integrated system of support.
It starts with developing a clear, quantifiable understanding of how lifestyle behaviors impact mortality and morbidity. The connection between lifestyle and health and longevity is well known, but measuring that connection in a way that enables actionable insights and tangible outcomes is challenging.
At RGA, we have analyzed health survey data from the U.S. Centers for Disease Control and Prevention (CDC) to quantify the impact of lifestyle behaviors and mortality experience. We are working to leverage our ongoing analyses to improve risk segmentation, pricing, and other applications throughout the insurance value chain for the benefit of policyholders and insurers alike.
Behavior change is hard. Many existing wellness programs struggle to increase healthy activities that result in long-term health improvements. This is where the industry must look to behavioral science, a primary driver of wellness program effectiveness and a key consideration for future applications across the wellbeing spectrum.
Behavioral science enables the design of engagement tools based on an understanding of the motivators of human behavior. Insurance-linked wellness programs provide a unique opportunity to offer financial incentives to reward healthy behavior via premium discounts and new product offers. Policyholders become more active participants in ongoing decision-making and can personalize their wellbeing activities and goals.
Not only does promoting well-being make good business sense for our industry, it is also the right thing to do for the many people we serve.
Reprinted with permission from Best's Review.