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  • March 2021
  • 7 minutes

Can Combining Technologies and Behavioral Science Improve the Life Insurance Value Proposition?

Female runner clambers up steps
In Brief
What if technology and behavioral science could work together to help all of us live healthier, longer lives? The impact could be transformative, argues Emmanuel Djengue of RGAX and Eric Gaubert of RGA France.

Do I drink more water than alcohol when having dinner at a restaurant with friends? At my lunch break, do I take 45 minutes to enjoy a healthy meal or eat fast food? 

While some of us may have adopted very healthy lifestyles, many more have not. But what if technology and behavioural science could work together to help all of us live healthier, longer lives? The impact could be transformative. For example, the World Health Organization (WHO) found that the proportion of total global deaths due to chronic "lifestyle" diseases is expected to increase to 70% of the global burden of disease by 2030, up from 56% in 2015. A basic understanding of behavioural science, combined with advances in wearable and personalized technologies, could begin to make a tangible difference in risk assessment.

There are reasons, rooted in human psychology and behaviour, that cause many of us to fail to act as we know we should. Cognitive biases, and the pressures of modern life, can defeat even the best intentions. For example, if you prefer red wine over water at dinner, you may fall into the “present bias” trap, or an aversion to delayed gratification in favour of an immediate reward. In other words, many of us would seize the prospect of sip of a good Cabernet over a less tangible future gain, such as healthier liver function.

Many of us are at pains to set objectives – avoiding an extra serving of cheesecake or sticking to the sparkling water over the pint of beer – but despite the best plans, personal trainers, and advice of friends, we fall into old habits.  Similarly, many of us fail to follow-through on New Year’s resolutions, a phenomenon behavioural scientists call the “intention-behavioural gap.” Often our “doing-selves” do not follow the intentions of our “planning-selves”. We know we should take a real break to have a proper, healthy lunch, but still end up ordering a snack.

Is there a way to help people achieve goals set by our “planning-selves”? Can insurers act to help people by designing value propositions that promote healthier behaviours? The answer may lie, in part, in whether carriers can fully grasp human biases and behaviours and harness technologies to use this knowledge to improve health.

Understanding Motivation

First, consider how people make decisions. In his book, Thinking Fast and Slow, famed behavioural scientist Daniel Kahneman argues the human brain has two different operating systems: System 1 and System 2. "System 1" is fast, instinctive, and emotional. "System 2" is slower, more deliberative, and more logical. When we think of human decision making, we often assume that people are rational, calculating decision-makers (System 2), and therefore providing people with fact-based information will lead to successful behaviour change.

Reality is a bit more complex. Matthew Battersby, Chief Behavioural Scientist at RGA, often uses smoking as an example: “Lots of money has been spent for many years trying to inform and change the minds of smokers about the dangers and risks associated with the activity,” he says. “Many smokers know these risks, yet still don’t change their behavior, and those who do change aren’t necessarily influenced simply by information. Instead, they may have been persuaded to stop smoking by various other factors, such as changes in the environment (e.g., smoke-free workplaces) and motivational aspects (e.g., it’s much harder to smoke when lots of your friends are no longer smoking).”

Even when consumers are well informed about a health danger, some may continue destructive behaviours.  Information alone – or system 2 thinking – is not enough. System 1 thinking may explain why; many smokers make instinctual, and perhaps irrational, decisions to continue the habit.

Most of us respond to environmental and social cues in a way that requires very little conscious engagement. Health decisions may be rational, but actual health behaviour is much less so and more often driven by often unconscious, cognitive processes. Memory is also imperfect, and attention spans are limited, making fully fact-based decision-making even more difficult.  

So, rather than bombarding a consumer with wellness data to encourage healthier behaviours, insurers can, instead, influence behaviour by using use tools/mechanisms that target human system 1 responses (fast, impulsive), appealing to psychology and not rationality. This can take the form of reinforcement or reminders that focus attention on personal health goals and rewards or even celebratory messages when individuals reach health milestones, such as a certain step count.

Applying Motivational Techniques

However, understanding human motivation is only half of the story. Success will require a means to reach the right customer, at the right time, with these messages. Wearable technologies offer a compelling means to help more people adopt healthier behaviour, but they also present limits.

Why are wearables so promising? Consider the enormous popularity of these portable, data-rich devices. CNN Business reports that the Apple Watch sold 31 million units worldwide, while all Swiss watch brands combined sold 21 million units, according to research from consulting firm Strategy Analytics. Market researchers have found that 81% of wearable device owners feel that they have made an improvement in their overall health/lifestyles by using these devices.

So, the adoption of wearables technologies represents one step forward for the watch trade, and one giant leap for the life/health insurance industry, right? Not necessarily. Many consumers appear to tire of these devices after their initial purchases, and levels of comfort with health data-sharing can vary.

The COM-B model in behavioural science can help explain why. The model states that human behaviour (B) consists of three components: capability (C), opportunity (O), and motivation (M). Capability refers to the belief that we are psychologically and physically able to change or improve a behaviour. Opportunity refers to a social or physical opportunity to make a change (or reduce the environmental triggers that spurred negative behaviour). Motivation is linked to  the desire to carry out a certain behaviour over competing behaviours.  

Capability (I can cycle) and opportunity (cycling near home is safe) are obvious, but what about motivation? How do insurers get it, and how can insurers provide it?

Mastering Motivation

All of us have faced situations in which we must motivate someone else to make a change, whether that person is a child, a coworker, or a stranger. We use persuasive techniques that draw on behavioural science, often unknowingly. For example, it is common to promise a reward: Do X thing and you receive Y benefit.

For organizations aiming to make us healthier and help us live longer, rewards make sense. But what rewards work? Behavioural science offers clues.

  • Frequent feedback: We are more likely to achieve a goal if we receive frequent and qualitative feedback, such as push notifications that congratulate users or explain areas of improvement.
  • Scarcity: Options or rewards that are perceived to be scarce can seem more attractive. For example, the idea of a “last chance” to win points can prompt someone using a wellness app to walk an extra 1500 steps.

Commitment contracts: We are more likely to achieve goals if we have committed to them, so encouraging customers to committing to goals through contracts leads to greater success.

  • Messenger: Our reaction to information and messages depends greatly on the credibility of the messengers. For example, a recommended exercise regimen from a famous gym coach will carry greater weight than a suggested regimen from a friend.
  • Salience: Our attention is drawn to what is novel and prominent—that’s why “Walk Now” push notifications in health apps may increase our activity rates.
  • Relative Ranking: We tend to do better if we can compare our performance to others.Competition yields results.
  • Utility: We act in ways that prioritize advantages, minimize losses, and maximize perceived value. That’s why health programs and apps that allow participants to clearly evaluate value, such as weight loss or health improvement, can drive results.
  • Ease: We are more likely to change our behaviour if we perceive that change to be easy. Programs that allow for incremental improvement, such as tips on how to walk 150 steps more per day, can yield greater participation.

Looking Forward

Insurance carriers are often perceived to have fewer customer interactions compared to other financial services providers, like banks.  However, the ability to engage through wearables could create more active relationships that benefit both the consumer and the insurer.

The popularity of connected devices offers an opportunity to support insurers in offering services that can adapt to consumer behaviour and support customers in managing personal risk and driving positive health change. Insurance companies can move from being perceived as simply “providers of policies that protect against risks ” to being seen as guardians of health and longevity. 

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  2. Healthcare-Wearables-Trends-Infographic-2019.pdf (
  4. RGA’s 2019 Global Life and Health Data Analytics Survey (Q2 2019 –Large multinational life and health insurance companies

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