MLC to give customers discounts on insurance by sharing health and fitness data

Health insurance company will tap into wearable data insights in order to understand a customer's level of wellness

MLC, the wealth management division of National Australia Bank, is giving health insurance customers the opportunity to lower the cost of their premiums in return for data on their exercise, sleep and lifestyle patterns.

The company has implemented the Covalence health analytics platform, built by US-based, disruptive big data tech provider, Big Cloud Analytics, into its new MLC On Track Program, which it claims is Australia’s first wearable device wellness initiative.

Using MLC On Track, MLC will be able to capture, organise and score information on participating customers’ health and wellness through Internet of Things (IoT) data generated by Intel Basis Peak fitness and sleep trackers, along with other data sources. Specific data sets being analysed include step count, hours of activity, sleep duration and average resting heart rate.

Data will then be presented to end consumers via personalised dashboards and include actionable trends and wellness scores, triggered messaging, content and programs.

Arguably, what is most significant about the initiative is how data will then be used to determine the product price points MLC will offer participating customers.

In return for sharing their personal data, and for meeting pre-determined wellness targets during a 90 to 160-day period, customers will receive a 5 percent discount on premiums. Additionally, customers are given two opportunities to capture the discount, for a total of 10 per cent off premiums for the life of their policy.

“It’s a potential game changer for the industry,” claimed MLC executive general manager Insurance, David Hackett. “For too long, companies have relied on old ways to do business. We want to create more value for an insurance customer beyond just the policy itself.”

MLC’s chief underwriter, Fiona Guscott, said identifying new ways to assess and price insurance risk will help cut costs for everyone involved.

“More importantly, as we reward healthy decisions, we can all work to achieve the greater goal of prioritising wellness,” she said.

Big Cloud Analytics CEO, J. Patrick Bewley, described the program as a unique alignment of the two companies’ interests.

“Customers can monitor their health habits in real-time to see how their activity and sleep levels can affect their health scores while reducing their premium costs,” he said. “Additionally, insurance providers become more engaged with their customers. Accessing massive amounts of longitudinal data and scores can significantly change how actuarial information has been derived for the past century. We are extremely pleased to play a key role in bringing this capability to life with MLC.”

BCA positions its proprietary health analytics platform as providing a deeper understanding of the health and wellness of the population as well as an early warning signal to consumers around their wellness and biometric changes.

Advanced analytics is becoming big business for insurance companies as they strive to better understand their client and customers and better manage risk. According to a recent study conducted by IBM across insurance companies, 74 per cent are using information including big data and analytics to create a competitive advantage.

In an interview with CMO last year, the global CEO analytics for global insurance giant, AON, Steven Mildenhall, revealed the company has spent $350 million in recent years building analytics capabilities which could not only improve existing insurance policies and risk management, but trigger profound shifts in how insurance companies innovate.

“In the past, from an insurance point of view, we had to rely on not observing the thing you actually wanted to observe – is someone careful, prudent, do they have good foresight and so on. You just observed if they did or didn’t by whether they claimed,” Mildenhall told CMO at the time.

“With all the data now available, you can directly observe many more of these behavioural characteristics that will be good drivers to understand risk.”

The motor insurance industry has already garnered plenty of headlines for its use of telemetry-based, in-car technology to record driving information of an individual customer’s behaviour in order to build a more personalised, accurate profile that better identified their level of risk.

But there are potential risks in terms of consumer privacy backlash. CapGemini head of data and insight, Frank Wondoloski, said over the past number of years, the industry has seen consumers choose convenience or price reductions over privacy time and time again.

"We have worked with other insurance companies who are at various stages of development of similar products and believe big data will accelerate these trends," he told CMO.

"Wearables are a whole new breed of technology which will, even beyond the insurance industry, drive data growth and provide new opportunities - but also force us all to think about privacy in new ways."

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+: google.com/+CmoAu

Join the CMO newsletter!

Error: Please check your email address.
Show Comments

Supporting Association

Blog Posts

Putting experience design and strategy in the spotlight

​A few years ago, there was lots of chatter about the elusive UX unicorn; a mythical person capable of delivering everything from research to design to development. It became an obsession for the industry, sparking debate about whether this was the metaphor for how unreasonable our expectations of designers had become, while some felt it was what all designers should be aspiring to.

Tracy Brown

Experience design strategy director, DT

Making sense of artificial intelligence

When new trends and technologies burst onto the marketing scene, there’s always a frantic effort to either keep up or provide guidance, especially when serious amounts of money are involved. It happened with social media, it happened with personalisation and big data, and it’s happening now with artificial intelligence.

Phil Whitehouse

Asia-Pacific innovation lead, DigitasLB

4 key findings on the state of B2B marketing

The ​2016 B2B Marketing Outlook Report​ was recently published by Green Hat in conjunction with ADMA for the sixth consecutive year. It highlights the most significant trends from 2015 and shows B2B marketers what’s in store for the year ahead.

Andrew Haussegger

Co-founder and CEO, Green Hat

Martech will definitely make everything better especially when it comes to marketing and sales. Any business not comfortable with it shou...

TapAnalytics

Marketo’s CEO talks martech industry consolidation and his enterprise customer ambitions

Read more

You can also try this leads to revenue calculator tool (it's free): https://www.strategic-ic.co.uk...

Fes Askari

​The dangers of misaligning your marketing budget with business goals

Read more

“We wanted to provide was a way for a customer to have a seamless experience as they went across channels,” Marrocco added. “So if your c...

Sarah

​Telstra’s mission to match the offline experience with online customer service

Read more

You have the right to know what happened that made AI possible, after all these years.I discovered and patented statistics on unstructure...

Ilya Geller

Making sense artificial intelligence - Food for thought - CMO Australia

Read more

I hope this trickles down to job opportunities and more analytics based careers on the government.

Ale Xandra

Australian Open details data analytics improvements driving digital fan engagement

Read more

Latest Podcast

More podcasts

Sign in