YOUR personal trainer might have screamed “no pain, no gain” during many exhausting work-outs, but insurers are taking the idea to a new level, with some offering financial rewards and lower premiums for keeping fit.
Just as installing a black box in your car to monitor how safely you drive may cut the cost of motor insurance, so a wearable device — such as a smartwatch or fitness band — can log your exercise patterns.
In both cases, information about behaviour and the risk you represent helps determine how much the insurer will charge you. A safe driver who exercises often should get a better deal than a boy racer addicted to his Xbox.
One leading insurer said wearable technology was “the future of insurance”, although companies are just beginning to explore its possibilities.
Vitality Health (previously Pru Health) is currently the only UK insurer to offer health and life policies linked to wearable devices. It used pedometers for a decade (now largely phased out),changing to the Polar fitness band in 2008 and then adding other devices.
Aviva does not offer device-linked cover but has an online questionnaire, My Health Counts, and a 12-week regime to follow based on data you provide.
If your health then improves — you lose weight and exercise more, say — you can get up to 15% off your premium on renewal. Aviva also offers discounts on hotel stays and gym memberships.
The health insurer WPA does not offer premium discountsbased on wearable device data, but it cuts the cost of premiums through a “co-payment” approach called Shared Responsibility. Customers pay a percentage of their claim if they are ill, up to an agreed annual maximum. The higher the maximum, the lower the premium. WPA said wearable devices had not yet made the case for lower premiums.
Daniel Ryan, head of research and development at the insurer Swiss Re, said: “Wearable technology will be the future of insurance. When an individual chooses to provide a company with information about their behaviour or medical history, the company should be giving them some service or financial recognition for that data. If you are asked to complete a survey, you would expect to be paid for your time.”
How does insurance and wearable tech work?
If you select a private health insurance package from Vitality, you are asked to submit information such as height, weight and exercise regime.
Based on this and personal goals, Vitality generates a plan for each customersetting out how to become healthier. You are entitled to a 50% discount on selected activity trackers, such as the Polar or Garmin bands, which measure activity when you walk, run, swim or do other types of exercise.
Apple and Android smartphones can also be used to log activity via Moves, a free health app.
Members can earn points when they use their devices to track their exercise or buy healthy foods from Sainsbury’s, or volunteer for a free health screening. Points count towards your “Vitality status” — bronze, silver, gold or platinum — and earn perks such as free cinema tickets. A separate deal is available for life insurance.
A lifestyle makeover
Robert Clarkson of Horley, Surrey, lost two stone and racked up about £2,000 in discounts and rewards in two years after joining Vitality Health and using a Polar heart monitor watch.
Discounts enjoyed by the 46-year-old, who is married and has two children, include half-price running shoes from Sweatshop and £300 off a £1,000 bike from Evans Cycles.
He said: “Money is tight for any family, especially with teenage children, so the financial incentives and the savings we made were really helpful to us as well as the improvements to our health.”