Typically, insurance exists to pick up the cheque when things go wrong. Technology and open data are the tools helping us change that relationship and shape the future of health insurance – shifting focus from payment to prevention. At Wellx.ai, we believe that focusing on prevention will enable insurers to not only benefit from improved profitability but also build happier, healthier, and more resilient communities. We set out to make people healthier, and insurance is helping us make it happen.
Technology and open data now give us access to how each member of the Wellx community behaves and cares for themselves. We can track, measure, and incentivize positive behaviors, pushing our members to do better for themselves which will then optimize the Wellx offering. In the short run, our use of real-time activity and engagement data will allow us to influence customer behavior. In the long run, the same data will allow us to guide each individual on how to optimize their health from an insurance perspective. Customers will know what to do, and when to do it, in a fun and engaging way.
The Wellx business model is built on data-driven insights coming out of telematics that lead to actionable outcomes. The future of pricing policies lies in being able to dynamically write risk at the back of data that flows through our partners like WHOOP and Steppi amongst others. Understanding how our members lead their lives- what positive and negative behaviors they exhibit, is the first step. Whether it is the hours of REM or deep sleep they get, their heart rate variability, changes in oxygen levels, or simply the number of gym visits – each action drives health outcomes. Rewarding good behaviors results in more good behaviors.
Prevention is prioritized, ahead of cure, and therefore, we take on the onus of motivating individuals to stay well while maintaining our commitment to being available to members when they need medical care. Many forms of risk are associated with individual or company behavior – whether it be the risk of a cyber-attack (perhaps driven by the lack of a robust cyber security system) or the risk of credit default (driven by high levels of credit/income) – every step in the right direction should be rewarded. This will lead to a better alignment of incentives across all industries. Why don’t mortgage rates reduce the moment candidates get a raise? Or why doesn’t it increase when candidates have made some poor purchasing decisions?
There is no downside, however, to having a healthy community. As we move away from the notion that our members cannot control their health outcomes (60% of all deaths in the UAE are from lifestyle diseases), we begin to realize that insurance now has a different purpose. With access to data, insurers are invited to play an active role in prevention. In the long run, the data will inform the benefits and wellness features of each subscription, all tailored to maximize each individual’s long-term health, reducing the likelihood of them falling sick to begin with.
“At wellx we believe that insurance will begin to play a more active role in the prevention of negative outcomes. Large corporations have robust risk management programs in place- and insurers reward good controls. Technology can now enable us to manage risk at an individual level.”- Vaibhav Kashyap, Founding Partner.
In the coming years, insurers will compete on their ability to reduce the likelihood of a loss, instead of who can pay the most when a loss happens. The pandemic has brought to attention the fact that a $5m limit, vs a $100k limit, will not necessarily reduce the likelihood of mortality. Had some of that premium been spent making individuals healthier, we might have had different outcomes. Companies in the Health/InsureTech space need the support of reinsurers and insurers to continue innovation and shift the narrative of insurance from a mandated commodity to a preventative partner. Fintech has received enormous funding interest from investors in the region, InsureTech should follow, and Wellx intends to charge the drive.