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Why digital lifestyle data is a turning point for the life and health industry

When carrying out risk assessments in the life and health industry, it can be easy to forget that behind every data point and complex calculation is a real person. We want to change that.

We are revolutionising how we assess, underwrite and even manage mortality risk. We want to make it easier for people to buy insurance and to create more ways for insurers to connect and engage with policyholders. A fundamental part of this change means recognising people are holistic and dynamic beings whose health is affected by both nature and nurture.

Today, there’s an unprecedented amount of increasingly credible health and wellness data becoming available. People regularly record their steps, amount of sleep and more on wearable devices or smart phone apps. It’s even possible to track and manage chronic diseases such as diabetes using an app – and manage, or even reverse, many of the symptoms.

The new shape of life and health insurance

This prevalence of digital individual health data has been fuelled in part by consumers’ growing awareness of their own wellbeing − and most importantly their ability to influence it.

As an insurance industry, and particularly at Swiss Re, we are focused on helping individuals manage their health and build resilience. We are using these new categories to design a risk assessment approach that supports individuals and empowers them to make changes.

As an industry, we have relied mainly on clinical data such as body mass index, blood pressure and lipids to assess risk, together with age and smoking history, to estimate an individual’s mortality risk at the point of sale.

In the new world of credible digital health and wellbeing data, we can now − with the permission of the individual and of course subject to any regulatory requirements − assess their mortality risk using lifestyle factors such as activity level, sleep and exposure to second-hand smoke.

Together with clinical factors, this data can be used to measure their health risk over the lifetime of their policy in a far more personalised and dynamic fashion.

This is important because it creates an engagement platform for individuals to interact with their insurance providers, improving the overall customer experience. It also creates incentives for individuals to manage their health, reflected in the cost of their insurance.

The Big Six

At the foundation of this more personalised and dynamic approach to insurance are several key lifestyle factors – we call them The Big Six. They are sleep, nutrition, physical activity, mental wellbeing, substance use and environmental factors.

We believe combining lifestyle and clinical factors is the future of risk assessment in the industry. Traditional underwriting that uses only a limited list of clinical factors needs to change. Consumers expect more, and now we have reliable, new data sources to make this happen. That’s why we’re creating a more holistic view of an individual’s mortality risk.

It also facilitates a future where underwriting is no longer a one-off initial assessment, but something that can be dynamic and flexible throughout the term of an insurance policy.

At Swiss Re, we are committed to embedding this tailored approach into our business – as well as the industry more broadly. So, subject to appropriate controls, we are building it into our underwriting philosophy and the industry’s most-used underwriting manual, Life Guide.

People track lifestyle factors because they want to improve their health. Our research, underwriting insights and risk scoring will help insurers develop products that match these aims – and provide customers with a simple, personalised, flexible journey that can lead to better health and security.    

This is a win-win situation.