Strap on the Fitbit: John Hancock to sell only interactive life insurance
By Suzanne Barlyn
Sept 19 (Reuters) - John Hancock, one of the oldest and
largest North American life insurers, will stop underwriting
traditional life insurance and instead sell only interactive
policies that track fitness and health data through wearable
devices and smartphones, the company said on Wednesday.
The move by the 156-year-old insurer, owned by Canada's
Manulife Financial Corp, marks a major shift for the
company, which unveiled its first interactive life insurance
policy in 2015. It is now applying the model across all of its
Interactive life insurance, pioneered by John Hancock's
partner the Vitality Group, is already well-established in South
Africa and Britain and is becoming more widespread in the United
Policyholders score premium discounts for hitting exercise
targets tracked on wearable devices such as a Fitbit or Apple
Watch and get gift cards for retail stores and other perks by
logging their workouts and healthy food purchases in an app.
In theory, everybody wins, as policyholders are incentivized
to adopt healthy habits and insurance companies collect more
premiums and pay less in claims if customers live longer.
Privacy and consumer advocates have raised questions about
whether insurers may eventually use data to select the most
profitable customers, while hiking rates for those who do not
participate. The insurance industry has said that it is heavily
regulated and must justify, in actuarial terms, its reasons for
any rate increases or policy changes.
Customers do not have to log their activities to get
coverage even though their policies are packaged with the
Vitality program. The insurer will begin converting existing
life insurance policies to Vitality in 2019, it said.
It is too early for John Hancock to determine if it is
paying fewer claims because of its Vitality program, said Brooks
Tingle, head of John Hancock's insurance unit. But data it has
collected so far about customers' activities suggest that it
will, Tingle said, as Vitality policyholders worldwide live 13
to 21 years longer than the rest of the insured population.
John Hancock's U.S. life insurance customers can choose from
a basic Vitality program in which customers log their activity
in an app or website and can receive gift cards for major
retailers after reaching their milestones, or an expanded
program that offers wearable devices and discounts of up to 15
percent on premiums, among other benefits, the company said.
(Reporting by Suzanne BarlynEditing by Bill Rigby)
© 2018 Thomson Reuters. All rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. "Reuters" and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.