Interactive policies provoke privacy, liability concerns

by Leo Almazora01 Oct 2018

Recently, John Hancock Financial, a subsidiary of Manulife in the US, announced that it will stop underwriting traditional life insurance and only sell policies that track fitness and health data from wearable devices and smartphones.

It seems like a win-win proposition — policyholders are nudged into healthy habits with discounts for meeting certain goals, and insurance companies would pay less in claims from longer-living customers. And people with already healthy lifestyles would likely be attracted by the prospect of discounts for hitting their own targets.

But experts are still worried. As Lisa Carver from Queen’s University has noted, users of such devices may not be aware of how much data they’re sharing. But according to John Hancock President and CEO Brooks Tingle, customers can choose how much data they will divulge, and the company will protect fitness data in the same way as they do other information they collect.

“So your wearable may track six things, but you might just want to share steps or calories,” he told The Verge in an interview. “The additional data elements we’re talking about — things like steps taken or whether you took an online nutrition course — is pretty small and inconsequential compared to the data we already have.”

There have also been other concerns of unintended health consequences. According to The Verge, many fitness trackers have been shown to be inaccurate at tracking heart rate, causing people to work out more or less vigorously than they should. And at least one academic study has suggested that having fitness information at their fingertips could, in the long run, actually lead people to shed fewer pounds than they otherwise would.

There’s also the possibility of people cheating with their fitness devices, though it wasn’t much of a concern for Tingle. “These programs are going to be in place for an average of 20 years and often much longer,” he said. “[W]hile people might figure out a way to get more steps in the short term, people aren’t going to do that for two decades.”

John Hancock allows customers to opt out of the program; Tingle stressed the importance of giving customers “total choice about whether they participate.” But as reported by CBC News, former Ontario Information and Privacy Commissioner Ann Cavoukian worried that over time, it will become mandatory, or there will be consequences such as higher premiums for people who choose not to divulge their data.

An increased focus on fitness data may also give life insurance companies excessive control over individual lifestyles. “My concern is that you give this power to someone who is giving you life insurance … then they get to decide what your healthy life looks like, even if we decide that’s not how a healthy life should look,” said Dan Bouk, author of How Our Days Became Numbered: Risk and the Rise of the Statistical Individual. “I can only imagine that certain types of yoga might not work well with an activity tracker.”

 

Related stories: 
Life insurers must adapt to tech innovations
New Manulife life insurance program rewards healthy living

 

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