John Hancock's Vitality Program uses fitness data from devices like Fitbit.
Life Insurance company John Hancock recently launched an add-on “interactive” feature for policyholders to report fitness data with activity trackers like Fitbit and Apple Watch. The program rewards those reaching health benchmarks with premium reductions. The concept was clearly laid out by John Hancock president CEO Brooks Tingle “The longer people live, the more money we make.”
The correlation between fitness data such as steps taken or hours of sleep, and life expectancy remains a murky. However, the embrace of activity data and a rewards system in a “gamified” environment represents a major change for the insurance industry. The idea is somewhat borrowed from the auto industry’s telematics devices that track auto data related to car owner usage and safety history.
The John Hancock program, called Vitality, aims to incentivize policyholders who opt-in with lower premiums. Currently there is no negative reinforcement with raised premiums for users with underperforming activity data, something auto insurers like Progressive implemented into their auto monitoring program. What do the Vitality program incentives amount to? John Hancock claims that users who meet health benchmarks can receive up to an annual $300 policy reduction.Download our free eBook 7 Sales Hacks for the Modern Insurance Agent
Whether John Hancock can equate fitness tracking to longer living policyholders (and a bigger bottom line) remains to be seen. Trackers like Fitbit can only report on basic health conditions like heart rate. There is also consumer concern for the sharing or selling of this fitness data. John Hancock claims they will not share the data and users are empowered to select which types of data to share within Vitality. Some medical professionals question how these gamified, interactive policies give insurance companies too much power when it comes to health, claiming health is more than just mere data.
Activity monitoring devices for auto and life remain opt-in features for policyholders. However if they become increasingly successful in gauging insurance risk, these monitoring programs may extend to health policies and become mandatory for more insurers.