The changing landscape of technology and customer wants are a challenge for every industry, with changes in the health industry being particularly rapid. Against this backdrop, insurers in the private healthcare market must continue to innovate to ensure that they are not left behind by new competition.
Private medical insurance (PMI) is a unique product in that, in an ideal scenario, it is never used. From the medical insurer’s point of view, the best customer is someone who has never used their product for 20 years. In such case, however, the customer may question the usefulness of the insurer.
To turn the argument on its head, it would be better if the customer viewed PMI as something that keeps them healthy, for them to start to think ‘the reason I haven’t claimed for 20 years is because my insurer has kept me healthy.’ When it comes to innovation in PMI, the customer is essential – if the customer doesn’t want it, don’t do it.
The insurance paradigm
In the traditional insurance paradigm, although the logical place to go from the starting point of opportunity is the customer, in practice the sequence is financials, underwriters and then the proposition team. By this time, the product has become completely un-customer-centric and has little or no flexibility.
In a revolutionary approach, when researching the opportunity of preventative care in the PMI market, AXA PPP decided to investigate the views of the customer first using attitudinal segmentation. The key finding was that people see health as part of life, a lifestyle.
A new competitive landscape
Private medical insurers not only face competition from their traditional rivals, but in the very near future, from the likes of Google, Facebook and other so far invisible competitors who have the potential to completely disrupt the industry. It is for this reason that the insurers need to stay close to their customers and seek innovations that meet their wants and needs.
What‘s driving innovation in healthcare?
- Artificial intelligence (AI) – Technology that offers accurate, up-to-date information replacing the traditional GP consultation
- Wearables – Technology that produces data that can be used to produce meaningful health insights, e.g. BioBeats is a wearable technology that can predict increased risk of a serious cardiac incident based on stress levels.
Feeding the innovation funnel
At AXA PPP, innovation is based on a focus on the customer and their lifestyle, underpinned by complete autonomy to innovate. Working collaboratively to combine their brand, distribution capabilities and considerable resources with the novel ideas of start-ups, they have been able to try new ideas in a way that was not possible in the traditional model. Instead of trying to bury competitors, their approach is to invest in potentially disruptive companies and technologies.
Constant monitoring of the global healthcare ecosystem also presents opportunities for innovation, with Tel Aviv in Israel proving a particularly fertile area for new ideas. This can be attributed to the country’s excellent healthcare system that includes electronic health records and a tendency on the part of the local population towards original thinking and good decision making. As well as working with many start-ups, AXA PPP is working with two hospitals in Tel Aviv to look at ways to support better management of chronic diseases such as hypertension and diabetes.
Innovation in PMI
An open and collaborative approach to innovation in the PMI market has led AXA PPP to develop a number of new products:
- A retail site that offers 15,000 health and wellbeing products with discounts for members. Not only does the site represent an intrinsic benefit to the customer, it also acts as a distribution line for innovative products such as BioBeats
- BioBeats biometric tracking that provides heart data, breathing data and motion analysis to understand an individual’s norm and create a personal understanding of when to apply simple interventions to reduce stress
- A preventative, affordable approach to healthcare without underwriting based on the use of a wearable
- LiveSmart health assessments that offer affordable analysis of blood tests carried out by means of a finger prick at home, by a nurse or at a clinic of choice. Results are delivered in plain English via a digital platform, followed up by a call from a doctor. Offers a cost-effective way for businesses to invest in the health of their workforce.
- Genetic testing based around lifestyle, looking at factors such as weight, metabolism, age, what types of food an individual should eat or what type of physical activity would best suit them
- Collaboration with PureGym to offer customers 50% off a membership
Changes in technology, disease patterns and demographics all present new challenges for the private medical insurers. Elderly care is an area that is underserved both by the government and, at the moment, by the private sector. The squeezed middle generation is happy to pay for help and peace of mind and there is an opportunity to support them in doing this.
Rapid developments in AI mean that development of asymptom checker is inevitable, as well as call centres with natural language telephony where a human-sounding robot can provide advice on the correct care pathway
Finally, it is crucial that private medical insurers begin to support and offer solutions for better management of chronic diseases, an area that is currently badly neglected.