Decades of research have demonstrated how individual health conditions and behaviors impact morbidity and mortality. When underwriting life and health insurance, however, determining how multiple wellness and lifestyle rating factors and comorbidities interact and affect one another remains challenging
Insurers have long understood that living an unhealthy lifestyle, which can include smoking, sedentary behaviors, poor eating habits, or excessive/inadequate sleep, among other factors, contributes to chronic conditions and adverse health outcomes. What insurers have lacked is the ability to accurately quantify the specific influence and interactions these activities have on health and longevity. For insurers, such risk assessment capabilities could enable premium pricing that better reflects policyholders’ individual risks and provide ongoing access to advanced metrics to improve underwriting methodologies. For consumers, a greater understanding of how lifestyle factors can affect quality of life could lead to behavior change and, through insurance-linked wellness programs, greater engagement with insurance providers as partners in health.
Groundbreaking research currently underway through a partnership between RGA and the University of Leicester in the U.K. seeks to help make this enhanced risk knowledge a reality. Investigators are collaborating to unearth greater insights into how lifestyle and wellness activities, such as diet and exercise, impact health conditions, such as cancer, diabetes, and cardiovascular disease, and to measure related mortality outcomes. The University of Leicester expects to announce early results of the RGA-sponsored research in the second half of 2023.
Potential of Wellness in Insurance
Interest in incorporating wellness into insurance has only increased since the notion first surfaced more than 20 years ago. Unfortunately, however, the industry has yet to realize the full potential of wellness initiatives. Implementing wellness strategies within insurance requires a deep understanding of the associations between lifestyle behaviors and health outcomes.
New and more comprehensive data sources, ongoing developments in technology, and advanced approaches to integrating biometric information into insurance products are moving wellness initiatives beyond mere marketing schemes. Insurers now see wellness programs as tools for gathering additional underwriting evidence and potentially improving the health and wellbeing of customers.
In 2021, RGA and RGAX surveyed more than 100 life and health insurers from around the world about their current and future wellness-related products and strategies, as well as challenges and opportunities in this area. The survey found that insurers see great potential for wellness initiatives to meet the needs of their policyholders and support their overall physical, mental, and financial health:
- 85% of insurers globally indicated that wellness is a top priority, particularly after the onset of COVID-19
- Wellness implementations are rising globally with 57% of respondents offering wellness-related products, digital tools and services, mental health support, and/or financial planning tools
- Top areas for growth in wellness are chronic disease management, mental health, and financial welfare
Data-driven expertise is required to help insurers achieve the full potential of their wellness initiatives.
Unprecedented Data Insights
The research collaboration between RGA and the University of Leicester will help life and health insurers realize the potential of wellness initiatives. This timely and first-of-its-kind study will draw insights from the UK Biobank, a longitudinal data set of approximately 500,000 adults between the ages of 37 and 70 who were recruited at baseline between 2006 and 2010. Participants provided comprehensive data on a broad range of biological, cognitive, demographic, health, lifestyle, mental, social, and wellbeing outcomes, and continue to do so today. This large biomedical database is also linked to routinely available national health records such as death and cancer registries, hospital episode statistics, and primary care data.
Data-driven research can help insurers calculate the impact wellness has on morbidity and mortality experience, and as the data available continues to improve, insurers are better able to differentiate risk and make smarter underwriting decisions. Specifically, researchers from both RGA and the University of Leicester are hoping to determine whether information on lifestyle choices (such as physical activity) can be used to improve the performance of traditional rating factors (such as age and sex) and comorbidities (such as high blood pressure) in predicting mortality and morbidity outcomes.
The data will be analyzed via statistical models that assemble constellations of variables to discover how they impact one another. The findings are expected to enhance underwriting considerations, pricing, and recommendations for wellness programs.
Although the analysis will focus on the predictability of current and future underwriting factors, it also has the potential to have significant public health implications by helping inform policyholders and supporting healthcare providers in encouraging people to engage in healthier lifestyle choices.