The next generation devices such as the Fitbit and smartwatchesare already gaining popularity for the data they are able to generate about our bodies. Wearables are often used to gather vital information related to our health and fitness levels. In this era of big data, it is surprising to know that only 5% of the wearable gadgets have been validated, but soon they will emerge as one of the parametersto determine medical insurance plans in India.

Amid the increasing cases of lifestyle diseases and sedentary lifestyles, the data captured by these smart devices is likely to have an impact on the frequency of the diseases and thereby the cost of health insurance claims.

Assessing Customer’s Health Behavior through the Wearable Devices

The data provided by these wearable gadgets can further be used by health insurance companies in India to assess the risk involved and the scope of improvement.

Presently, the insurance provider’s only asses the customer profile based on their self-declaration and medical test. Sometimes, lifestyle-related health risks are missed out as real-time health updates are not available to the insurers.

But with these wearable devices, the insurers can be provided with a regular stream of health data. The data captured by these devices will provide customer’s health statistics and the insurer will be in a position to price the risk better.

These devices can even track the user’s movement,diet patterns, sleeping patterns, and emotions with their powerful sensor technology. Moreover, they also update the number of minutes the user was physically active and the calories burned during the day.

Once sufficient data is collected, discounts on the health insurance premiums can be passed on to the healthier customers.

For example, at the time of health insurance renewal, the proposer can earn discounts on the premium rates based on the lifestyle alterations, and improvement in cardiovascular health for heart patients.

To get more and more customers, the insurance company can offer monthly and yearly rewards to the policyholders based on the number of active days a user has clocked. Let’s say for a particular number of calories burnt and a particular number of steps taken in a day.

Not only they are beneficial for the health insurers, but for life insurance sector also these gadgets will prove to be a useful technological advancement. The insurers will be able to segment customers, offer them better pricing and speed-up the claim settlement and health insurance renewal process.

Discounts and Rewards

IRDA allows the general and health insurance companies to concoct mechanisms to reward pro-activeness of the policyholders. And wearables are one of the simplest ways to reward an individual based on their fitness levels.

Nearly, 15 to 20% of the policy seekers opt for some or the other form of reward programmers.

As per the industry reports, some general insurance companies offer up to 10% of the reward points on the insurance premium to their customers annually.

The rewards cannot be extended on any third-party claims or products, but they can earn discounts on medical screening, pharmaceutical, and consultation services at the network hospitals.

By using wearables, the insurers can collect data on the lifestyle habits of the customers. To increase the adoption rate, insurers canincentivizethe customers showcasing healthy behaviorand give discounts at the time of policy renewal or purchase of a new insurance product. In the long-term, it will help in reducing the potential claim cost as well.

Not a lot of people have synced their devices to the health insurance providers’ app. And by the time they remember syncing the device, a lot of health-related data is already lost. So, the syncing levels can pose challenges and the insurers will need to work on it.

In a Nutshell

The purpose of investing in the wearable gadgets is not only restricted to earning discounts on the health insurance premiums or lowering the possibilities of health insurance claims. People, especially the millennials are already investing in Fitbit as a preventive health measure. The idea of engaging on the go with the use of smart devices intrigues the younger generation. Therefore, the cost of these wearables should not be a hindrance for the health insurance industry.

Moreover, combining health insurance with wearable devices will certainly change the perception of how people make claim to get the assured amount. It will inculcate a feeling of satisfaction as the people will feel that their health initiatives are getting recognized. And the benefit of buying medical insurance policies in India is not restricted tothe hospitalization only.

Even if we consider the underlying benefits, the concept of wearables will take time to establish in the insurance industry. As per the industry experts, if 25% of consumers can engage through wearables, it will be a great number for the health insurance market.

Author Bio: Shruti Gupta is a writer, digital marketer and outreaching expert .She writes about technology, startups & other niches. She has contributed to a number of famous websites like Thenextweb, Deccanchronicle and Crazyegg. Stay tuned with her at:@shruti_gupta01 or via Skype : shrutigupta2811

Wearable Gadgets and Health Insurance