As individuals, we have access to reams of personalized data directly via our personal devices. This also means that a broader range of companies has access to that data, including big tech companies, like Amazon and Apple. The insurance industry is well aware of this, and we are now at a pivotal point where the insurance market is using this smart data to transform the way they do business.
Digital health broadly focuses on the development of interconnected health systems to improve the use of smart devices, computational analysis techniques and communication media, to aid healthcare professionals and patients manage their illnesses and the associated risks, as well as promote health and wellbeing. Digital health provides an opportunity, not only to improve people’s health and the quality of their lives but also to deliver massive cost savings as a result of increased prevention and early detection.
Gone are the days when individuals tracked changes in their health by simply writing it down, for example. According to the UK Digital Health Report by PushDoctor.co.uk, 71% of British adults feel positive about using technology to better understand their bodies and habits; believing that technology is helping them to be more aware and in control of their health. Whether it be monitoring exercise levels, checking medical symptoms, establishing BMI scores, monitoring heart rates or checking blood pressure, individuals are increasingly recording health information on a regular basis.
Insurers are always looking at where the next potential threat from big technology will come from. This year the answer has become clearer: health.
The potential for tech giants to eat into the €1.4 trillion-a-year global market for private medical insurance looms. Since the beginning of 2018, Amazon has already announced a health tie-up with Berkshire Hathaway and J.P. Morgan, while Apple has launched a health app that allows users to see their medical records and a range of other health data on their iPhones.
But insurers aren’t just sitting still and waiting to be pushed out of the healthcare industry. There are obvious signs of a transfer from a traditional, finance-focused, slow-moving insurance market to something new and disruptive. The insurance proposition is evolving.
Insurers including Axa, Allianz, Aviva, Ping-An and Cigna are increasingly pouring money into health technology startups. There are obvious benefits to being active in the digital health space as it provides direct access to the customer, with the potential to build better relationships, moving away from the traditional ‘once-a-year premium renewal’ contact.
“Digitalization within health allows us to create new offerings around actual customer needs – thereby, combining technology, insurance and service,” said Dr. Gregor Wiest, Head of Innovation at ERGO Group.
Some insurers have employed technology for health tech-related products for years. Vitality, a brand developed in South Africa which is now used by different insurers around the world, offers discounts to customers who log their exercise data with fitness-tracking devices, such as Fitbits.
The insurance industry has traditionally been about managing risks and providing cover when something goes wrong, and the healthcare system – particularly in the US – is almost exclusively geared towards providing treatment after we get sick. However, by harnessing today’s technology, we can transition to investing more healthcare resources into prevention and early detection.
Exciting new technology is in development focusing on real-time early detection. Examples include smart toilets that analyze your urine and microbiome while searching for early signs of diabetes and colon cancer, to a smart bra that detects minuscule breast tumors, and smartwatches that can communicate your heart rhythms directly to your cardiologist. The proposition to customers is much more about keeping them healthy, rather than making them better.
That is exactly what one of Startupbootcamp InsurTech’s London startups, vHealth Lab, is doing. vHealth Lab is a smart telemedicine artificial intelligence (AI)-powered platform for medical diagnostics and remote patient monitoring, that focuses on monitoring of patients with cardiovascular diseases.
“Being a cardiac patient is hard,” says Nina Sesto, CEO at vHealth Lab. “People have a ticking bomb in their chest yet no means to understand what is happening with their heart, meaning that they delay getting help.”
Nina adds: “All the advances in medicine and increased lifespan creates a huge number of chronic patients and skyrocketing healthcare costs. So, every insurer is aware that the existing system isn’t sustainable anymore. New technology allows us to shift the focus from treating the disease – which is the costliest option – to preventing the disease, which is in the interest of the insurer. In this triangle of patient, healthcare provider and insurer, it is a win-win-win combination for everyone.”
For prevention, everyday fitness wearables and mobile apps have a powerful role to play. In a recent white paper, Munich Re found that physical activity as measured by steps per day is an important predictor of mortality risk – or life expectancy — even after considering smoking status, BMI, cholesterol, blood pressure and history of diabetes, cardiovascular disease and cancer. Sedentary behavior, as measured by steps per day, is indicative of relative mortality that is over three times higher compared to active behavior.
So much of the technology being built for the healthcare industry is about improving individuals’ health and wellbeing. Boundlss, one of Hartford InsurTech Hub’s startups, mission is to end lifestyle disease. Using data from wearables, sensors and mobiles, its digital health platform provides both computer – and human-generated recommendations at the right time and place to help consumers live a healthier, happier and more productive life.
“We believe that the best way to do this is to provide deeply personalized one to one health coaching, to educate, motivate and support people to live a healthier lifestyle, day in day out,” says Shona Cotterill, Business Development Director for Europe at Boundlss.
“We work with health and life insurers to provide their members with their own virtual health coach. To provide a personalized solution on a large scale, our health coaching is a smart, seamless blend of AI and human conversation. When members connect their wearable or fitness app to the Boundlss app, the virtual trainer can provide them with personalized feedback based on their steps, activity levels and sleep. This personalization, and the rich two-way conversation keeps people engaged with a Boundlss health coach longer than other health apps,” Shona adds.
Every pillar of the healthcare industry is acknowledging the importance of innovation. According to a digital health study conducted by Rock Health, $3.5 billion was invested into digital health companies in the first half of 2017 alone. But it is important to recognize that despite the sheer volume of investment into technology for healthcare, it is not meant to replace human interaction. Technology can benefit the industry by helping to streamline processes and improve patient engagement.
Big data and analytics have the most potential for innovation within digital health. Derma 4.0, another London InsurTech startup, offers AI-powered skin cancer screenings with an improved accuracy of detecting malignant melanomas for physician office and mobile patient applications. Not removing the level of human interaction required in medicine, the Derma 4.0 solution improves physicians’ diagnostic accuracy in detecting malignant melanomas, with the potential to reduce false negative diagnoses by c.25%.
“The healthcare industry is moving towards a more patient-centric approach and there are a number of technology companies out there, including Derma 4.0, that can provide more reliable and ultimately cheaper data, that can help achieve that goal of patient centricity. We are developing an algorithm that can detect skin cancer better than dermatologists can. The benefit for our users is that it can save some of their lives – and will certainly reduce the number of biopsies they have to go through. One benefit for the health insurers is that they can save costs through less skin cancer treatments they have to pay out for,” says Dominik Seliger, CEO at Derma 4.0.
Activity data from smartphones and wearables is starting to provide insurers with new information to inform risk assessment and underwriting. With leading insurance companies using members’ biometric data to keep them engaged and informed about their health, it allows them to benefit from lower premiums if they reduce their health risks. This only looks set to grow in the future.
Insurers are responding to the opportunities of new technologies, provided by the likes of vHealth Lab, Boundlss and Derma 4.0, by building specific, personalized services into their products. The big question is how they now encourage their customers to use the new offerings on a continuous and regular basis.