Financial giant John Hancock Financial Services Inc is converting all its life insurance policies to an incentive-based system using activity tracking, a move aimed at promoting healthier lifestyles, but which also raises privacy questions.
The Boston-based insurer on Thursday announced that it would immediately begin moving life insurance policies to a “behavior change platform that rewards customers for the everyday steps they take to live longer, healthier lives.”
Policyholders would be asked to sign up online for fitness and nutritional advice, or might get premium discounts for using devices such as Fitbit or Apple Watch to monitor daily activities.
Photo: Reuters
“For centuries, the insurance model has primarily provided financial protection for families after death, without enhancing the very quality it hinges on: life,” president and chief executive Marianne Harrison said.
“We fundamentally believe life insurers should care about how long and well their customers live. With this decision, we are proud to become the only US life insurance company to fully embrace behavioral-based wellness and leave the old way of doing business behind,” she said.
One of the largest US life insurers, John Hancock said the new offering is aimed at countering unhealthy lifestyles, including physical inactivity, poor diet, excessive alcohol use and smoking blamed for most premature deaths, and expressed hope that other companies would follow suit.
The company, a division of Manulife Financial Corp of Canada, said it believes people who use these kinds of wellness and activity-tracking programs would live longer with lower medical bills compared with those who do not use the systems.
The effort stems from a partnership agreed in 2015 between Hancock and VitalityHealth, part of the South Africa-based financial group Discovery Ltd, which offers incentive-based wellness programs.
Wellness programs using health tracking have been in use for years, but privacy advocates worry about the risks or invasive monitoring of personal habits.
“I realize this is to encourage healthier habits, but I worry about excessive data collection,” said Nuala O’Connor, president of the Washington-based Center for Democracy & Technology, a digital rights group.
“These devices can collect a lot of data, such as your location or whom you associate with, much more than what they need to know if the person is insurable. There can be unintended sharing of that data,” she said.
Others expressed concern over the idea of using incentives linked to data collection, sometimes called “gamification.”
Marc Rotenberg, president of the Electronic Privacy Information Center, said the move raises questions about “algorithmic transparency” or whether insurance decisions are fair, accountable and transparent.
“There are also larger policy questions, including whether it is possible to maintain insurance markets if companies are able to assign risk directly to individual policy holders,” Rotenberg said.
The announcement comes amid a push by some employers to introduce wellness programs, which might require employees to wear fitness trackers to obtain health coverage, or to get discounts.
O’Connor said that the private life insurance offering is not as invasive as a mandatory employer-based program, but added that the benefits of such wellness programs might be overblown.
A 2015 study cast doubt on the accuracy of data from wearable devices and questioned whether the data should be used for important decisions.
Wearables and health apps “are buggy, produce errors, they can be gamed and the data are open to misinterpretation,” said Kate Crawford, a New York University research professor who was co-author of the 2015 study and is a cofounder of the AI Now Institute, which studies social implications of artificial intelligence.
There are additional concerns about trading personal data for economic benefits, Crawford said.
“What concerns me is that people are being told that wearing these devices will get them discounts and gift cards, but they are giving up enormously detailed portraits of their lives,” she said.
“What if policies change such that ‘negative’ behaviors are punished?” she added.
INVESTOR RESILIENCE? An analyst said that despite near-term pressures, foreign investors tend to view NT dollar strength as a positive signal for valuation multiples Morgan Stanley has flagged a potential 10 percent revenue decline for Taiwan’s tech hardware sector this year, as a sharp appreciation of the New Taiwan dollar begins to dent the earnings power of major exporters. In what appears to be the first such warning from a major foreign brokerage, the US investment bank said the currency’s strength — fueled by foreign capital inflows and expectations of US interest rate cuts — is compressing profit margins for manufacturers with heavy exposure to US dollar-denominated revenues. The local currency has surged about 10 percent against the greenback over the past quarter and yesterday breached
MARKET FACTORS: Navitas Semiconductor Inc said that Powerchip is to take over from TSMC as its supplier of high-voltage gallium nitride chips Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday in a statement said that it would phase out its compound semiconductor gallium nitride (GaN) business over the next two years, citing market dynamics. The decision would not affect its financial targets announced previously, the world’s biggest contract chipmaker said. “We are working closely with our customers to ensure a smooth transition and remain committed to meeting their needs during this period,” it said. “Our focus continues to be on delivering sustained value to our partners and the market.” TSMC’s latest move came unexpectedly, as the chipmaker had said in its annual report that it has
SECURITY WARNING: The company possesses key 3-nanometer technology, and Taiwan should prevent it from being transferred to China, a lawmaker said The Ministry of Economic Affairs yesterday said it would conduct a “strict review” of any proposed acquisition of Taiwanese tech company Source Photonics Co (索爾思光電), following media reports that a Chinese firm was planning to buy the company in the Hsinchu Science Park (新竹科學園區). Local media reported that Suzhou Dongshan Precision Manufacturing Co (東山精密), China’s largest printed circuit board manufacturer, had announced plans to acquire Source Photonics for 5.9 billion yuan (US$823.1 million). The ministry said it has not received an application from Source Photonics and has formally notified the company that any buyout would constitute a change in its ownership structure. The
ELECTRONICS: Strong growth in cloud services and smart consumer electronics offset computing declines, helping the company to maintain sales momentum, Hon Hai said Hon Hai Precision Industry Co (鴻海精密) on Saturday announced that its sales for last month rose 10 percent year-on-year, driven by strong growth in cloud and networking products amid the ongoing artificial intelligence (AI) boom. The company, also known internationally as Foxconn Technology Group (富士康科技集團), reported consolidated sales of NT$540.24 billion (US$18.67 billion) for the month, the highest ever for the period, and a 10.09 percent increase from a year earlier, although it was down 12.26 percent from the previous month. Hon Hai, which is Apple Inc’s primary iPhone assembler and makes servers powered by Nvidia Corp’s AI accelerators, said its cloud
RSS