Think about it: With over $20 trillion of life insurance in-force in the United States alone, wouldn’t you expect more life insurance companies to be devoted to helping their policyowners enjoy long and healthy lives? Apart from making an inspirational mission statement, this might also help us to set more ambitious goals around reinventing the life insurance customer buying experience.
There has been a lot of industry focus recently on “fluidless” or “non-invasive underwriting.” Trading underwriting accuracy for small improvements in issue speed just doesn’t seem to go far enough toward truly reinventing the customer experience.
We believe that the best way to improve the customer experience is by embracing ongoing wellness exams using convenient point-of-care diagnostic tests that generate immediate results. This strategy delivers protective value at the point of sale AND continuously throughout the life of the policy by supporting incentives and discounts for ongoing participation in wellness exams and monitoring.
Why routine wellness exams
A November 2014 Kaiser Foundation survey representing U.S. adults found that 62 percent of respondents reported having an annual exam by a doctor. And 92 percent of respondents considered these wellness exams to be somewhat or very important.
Even if we adjust this number closer to a 2007 study, which estimates that over 45 million routine wellness exams are performed in the U.S. each year, the figure is still over four times the roughly 10 million exams conducted by life insurance companies. And the cost of preventive wellness services are fully reimbursed by most health insurance plans sold in the U.S. without applying deductibles or copays.
In May 2016, the Equal Employment Opportunity Commission (EEOC) issued final regulations regarding levels of discounts employers can offer on employee health insurance premiums for participating in wellness programs. The maximum discount is now 30 percent of premiums.
Those familiar with typical health insurance premium levels will recognize that this amounts to potential savings of more than $1,000 a year and those discounts can be applied to premiums for both participating employees and participating spouses. According to the “2016 Benefits Report” of the Society for Human Resources Management , 72 percent of U.S. employers now offer wellness programs. That’s up from 58 percent in 2008. The percentage continues to grow rapidly.
The healthy life product strategy should feature integration of ongoing wellness exam data with all of the leading fitness and health tracking wearables and health monitoring devices. (Photo: Thinkstock)
Clinics and wellness plans as distribution partners
It’s no secret that health plans eager to reduce costs are squeezing doctors’ fees in all specialties. The two key components of a typical wellness exam are (1) a health risk assessment, or set of health and behavioral questions similar to Part B of a typical life insurance application but designed to be much more helpful; and (2) biometric screenings (aka diagnostic tests).