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The Intersection of Wearables and Insurance: Redefining Premiums for the Digital Health Era

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There is no denying that today, there is a flavor of the Internet of Things (IoT) in almost anything and everything we deal with in our day to day lives.
IoT with Salesforce

Connected Healthcare: IoT for Wellness

There is no denying that today, there is a flavor of the Internet of Things (IoT) in almost anything and everything we deal with in our day to day lives. This makes more and more data available that makes an average consumers’ life easier and by that virtue, greatly helps companies that are on a constant prowl to build and develop deeper and more personalized solutions/products for their customers.

Gartner has estimated that about 6.4 Billion connected things will be in use by the end of 2016, with close to 5.5 million new things getting connected every day. With significant adoption and incremental inter-connectivity that the world of IoT brings, the opportunity for Connected Healthcare is unparalleled.

This boom in the connected healthcare sector is driven by – Data and Analytics. Thanks to the terabytes of information available digitally, today’s consumers are more aware and want to know everything about their health and have a sense of control over it.

And thus, comes the opportunity for Enterprises and Consumers to ReImagine healthcare for a better and healthier life wherein, connected health is not merely about communication channels between a patient and his/her provider, but is used effectively by the wellness-seekers also. The wave of wearable technology has at both, conscious and sub-conscious levels, made us intrigued about connected healthcare.

But given the opportunity and potential, we aren’t alone as other sectors including pharmaceuticals, healthcare devices, connected device and even insurance companies are constantly endeavoring to make meaningful products and solutions, and by that virtue, a sustainable and scalable business model out of it.

Personalized Premiums: Wearables Transform Insurance

While the healthcare industry has already adopted connected solutions that are used primarily in medical devices, remote patient monitoring, mHealth applications, reimbursement models; today Life Insurance companies are making use of this disruption too.

The genesis of which, stems from a concept that was seen in the field of vehicular insurance – PAYG (Pay As You Go) wherein, the consumer’s longetivity is focused on monitory benefits for those who are healthier just by paying lower premium values.

The present (traditional) model (of insurance companies) calculates the premium by considering factors like age, gender, weight, height, dependent occupation, smoking, risky hobbies and also conduct amedical test. The amount of premium value for the followingyears increase when policyholders claim the insurance or fall under different age brackets (for example: 20-35 years, 35-50 years, 50 years etc).

Thus both insurers and policyholders face problems wherethere are abnormal increases in the insurance premium and the constant risk of inaccuracies in premium values depending on when or how quickly a customer has to be provided with a policy/service.

Arguably, wearables today, are non-HIPAA (Health Insurance Portability and Accountability Act) compliantentities which leads to the rise of issues around data privacy and information security as the data these devices churn-out are personal data that expose a user to threats that go beyond the realms of eHealthcare.

In this regard, a new set of rules and regulations could be introduced for these devices to make them HIPAA compliant and there by mitigating most, if not all, security risks. In the context of data sufficiency and relevance, insurers too face an extremely uphill task of ensuring that the data that comes from the wearables is authentic as it directly impacts the premiums they collect from the user.

The ideal way for Insurance companies is to tie-up with the wearable manufacturers or bring in the BYOD (Build Your Own Device) concept in order to give a more holistic service whilst ensuring gains in the form of ‘fixing most accurate insurance premium’ per user’.

In such a scenario, the threat of drops in the usage of wearables can be reduced because the customers who use wearable devices in conjunction with insurance company are twice as likely to still be engagedwith their devices. This loyalty and backed by the high levels of engagement, help in creating several other scenarios such as:

· Increasing life longevity
· Customized medication
· Predictive analysis of health and hence avoiding any life threatening medical conditions

So how exactly would the use of wearables help in reductions of premium amounts? Quite Simple! They do their standard and usual job of a tracking device that provides real-time data that is tangible, trend-based and predictable.

Adopting such technology, insurers are likely to reduce the size of their claims in the future as they will be able to measure risks more accurately – simply put, the more real-time data that one gets, the better it can be translated to a person’s health. For example, if a person is healthy and maintains a healthy lifestyle, there would incentivized monetary benefits on the premium and conversely, if the health is deteriorating because of an unhealthy lifestyle, the healthy premiums would rise. Not only does contribute to good health, it brings back tangible wealth!

This article first appeared in The Economic Times.

About Author

With over a decade of experience in business enhancement roles in different companies, Kuldeep is a part of the strategic business research team at Altimetrik. His core responsibilities center around market watch, data-driven strategic insights, and initiatives to help the business mitigate risks and generate better results.

Kuldeep is a bit of an adrenaline junkie with a keen interest in the latest developments in the world of business and technology.

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Kuldeep Sharma

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Michael Woodall

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Michael Woodall, as the Chief Growth Officer of Financial Services at Altimetrik, spearheads the identification of new growth avenues and revenue streams within the financial services sector. With a robust background and extensive expertise, Michael brings invaluable insights to his role.

Previously, Michael served as the Chief of Operations and President of the Trust Company at Putnam Investments, where he orchestrated strategic developments and continuous operational enhancements. Leveraging strategic partnerships and data analytics, he revolutionized capabilities across investments, retail and institutional distribution, and client services. Under his leadership, Putnam received numerous accolades, including the DALBAR Mutual Fund Service Award for over 30 consecutive years.

Michael’s dedication to industry evolution is evident through his involvement with prestigious organizations such as the DTCC Senior Wealth Advisory Board, ICI Operations Committee, and NICSA, where he served as Chairman and now holds the position of Director Emeritus. Widely recognized as an industry luminary, Michael frequently shares his expertise with various divisions of the SEC, solidifying his reputation as a seasoned presenter.

At Altimetrik, Michael plays a pivotal role in driving expansion within financial services, leveraging his expertise and Altimetrik’s Digital Business Methodology to ensure clients navigate their digital journey seamlessly, achieving tangible outcomes and exponential growth.

Beyond his corporate roles, Michael serves as Chair of the Boston Water & Sewer Commission, appointed by the Mayor of Boston, and is actively involved in various philanthropic endeavors, including serving on the board of the nonprofit Inspire Arts & Music.

Michael holds a distinguished business degree from Northeastern University, graduating with distinction as a member of the Sigma Epsilon Rho Honor Society.

Anguraj Kumar Arumugam

Chief Digital Business Officer for the U.S. West region

Anguraj is an accomplished business executive with an extensive leadership experience in the services industry and strong background across digital transformation, engineering services, data and analytics, cloud and consulting.

Prior to joining Altimetrik, Anguraj has served in various positions and roles at Globant, GlobalLogic, Wipro and TechMahindra. Over his 25 years career, he has led many strategic and large-scale digital engineering and transformation programs for some of world’s best-known brands. His clients represent a range of industry sectors including Automotive, Technology and Software Platforms. Anguraj has built and guided all-star teams throughout his tenure, bringing together the best of the techno-functional capabilities to address critical client challenges and deliver value.

Anguraj holds a bachelor’s degree in mechanical engineering from Anna University and a master’s degree in software systems from Birla Institute of Technology, Pilani.

In his spare time, he enjoys long walks, hiking, gardening, and listening to music.

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Chief Digital Business Officer and Head of the EMEA region

Vikas (Vik) Krishan serves as the Chief Digital Business Officer and Head of the EMEA region for Altimetrik. He is responsible for leading and growing the company’s presence across new and existing client relationships within the region.

Vik is a seasoned executive and brings over 25 years of global experience in Financial Services, Digital, Management Consulting, Pre- and Post-deal services and large/ strategic transformational programmes, gained in a variety of senior global leadership roles at firms such as Globant, HCL, Wipro, Logica and EDS and started his career within Investment Banking. He has developed significant cross industry experience across a wide variety of verticals, with a particular focus on working with and advising the C-Suite of Financial Institutions, Private Equity firms and FinTech’s on strategy and growth, operational excellence, performance improvement and digital adoption.

He has served as the engagement lead on multiple global transactions to enable the orchestration of business, technology, and operational change to drive growth and client retention.

Vik, who is based in London, serves as a trustee for the Burma Star Memorial Fund, is a keen photographer and an avid sportsman.

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Chief Digital Officer, US Central

Megan is a senior business executive with a passion for empowering customers to reach their highest potential. She has depth and breadth of experience working across large enterprise and commercial customers, and across technical and industry domains. With a track record of driving measurable results, she develops trusted relationships with client executives to drive organizational growth, unlock business value, and internalize the use of digital business as a differentiator.

At Altimetrik, Megan is responsible for expanding client relationships and developing new business opportunities in the US Central region. Her focus is on digital business and utilizing her experience to create high growth opportunities for clients. Moreover, she leads the company’s efforts in cultivating and enhancing our partnership with Salesforce, strategically positioning our business to capitalize on new business opportunities.

Prior to Altimetrik, Megan spent 10 years leading Customer Success at Salesforce, helping customers maximize the value of their investments across their technology stack. Prior to Salesforce, Megan spent over 15 years with Accenture, leading large transformational projects for enterprise customers.

Megan earned a Bachelor of Science in Mechanical Engineering from Marquette University. Beyond work, Megan enjoys playing sand volleyball, traveling, watching her kids soccer games, and is actively involved in a philanthropy (Advisory Council for Cradles to Crayons).

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