IRDAI will soon come out with regulations for life and health insurance companies that use fitness trackers and wearable’s for pricing policies. The issues involved include privacy of individual data and applying the principles of insurance. Insurance Regulatory and Development Authority of India in a statement said that insurers now look at ensuring ‘wellness’ of the customer and this is factored into their pricing and product design. For example, some insurers reward policyholders for maintaining a fitness regime or undergoing regular diagnostics.
The insurance regulator has set up a panel to look into innovations in insurance involving wearable/portable devices.
As per IRDAI, “Use of wearables and portable devices in insurance are a subject that frequently comes up in the context of financial technology. In the context of both health and life insurance, wearable devices could be used to measure personal fitness and incorporate a healthy lifestyle.”
The terms of reference for the panel include examining technological advancements in portable devices and seeing how they can be used for improving assessments and reducing risks. The panel will also look at global developments in the area and suggest a policy framework, keeping in mind the interests of the customers.
According to Cigna TTK Health Insurance MD and CEO Sandeep Patel, almost everyone has a pedometer on them either as a wearable device or in a mobile phone. “This data is very valuable and can be leveraged very well,” said Patel.
Cigna TTK has its own Get ProActiv app, which can be integrated with wearable devices. The company is incentivising policyholders to be active by providing discounts at the time of renewal.