Event-driven insurance

John Hancock, one of the largest and oldest insurers in the United States, owned since 2004 by Canada’s Manulife, has announced it will stop selling traditional life insurance and will only market interactive policies that record the exercise activities and data of health of its customers through wearables such as Fitbit or Apple Watch.

These types of policies are becoming increasingly popular in markets such as South Africa, the United Kingdom and the United States, and are sold as an advantage both for users, who have an additional incentive to lead a healthier life, and for insurers, who get a portfolio of clients with healthier habits who tend to live longer and make fewer claims. Its detractors argue, however, that insurer may try to optimize their portfolios based on the data obtained, trying to offer less attractive conditions to those with variables indicating a higher risk.

As technology improves the ability of devices to record data related to exercise and health, more companies are seeing the opportunities this new approach may offer. Connected devices are beginning to see widespread adoption across all industries. Insurers have to effectively plug into, access and translate this wealth of IoT data to gain the right level of information to enhance risk analysis, underwriting and claims.

Event-based (‘parametric’) insurance is the best way to insure the uninsurable but it requires smarter data.

Insurtech are exploiting a new market of on demand insurance (Travel, Flight protection, Smartphone, Tablet, Action cameras & Drones, Home appliance, Pets). Event-driven insurance represents a simple, new revenue streams for banks, too. Parametric insurance risk is decreasing with time thanks to better risk hedging and data-driven predictive models.
No loss adjusters plus automated underwriting and claims means reduced costs.
Uncertainty is reduced because risk is easier to predict on parameters and data is monitored constantly.
A reduced premium boosts sales and new market penetration.

Our technology accurately captures, analyzes and impact behavior through artificial intelligence to deliver personalized financial protection.

Learn more about LIFEdata’s solution for event-driven insurance

• Move data usage from analytics and intelligence to automated actions
• Access and translate the wealth of data from IoT for your business.