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Two articles published over the last two weeks put non-marketing insurance industry social media issues at the forefront, discussing the risks involved with social web engagement in two different scenarios. The first article, “How Insurance Companies Will Influence Rates Based On Your Tweets: Social Insurance Rates,” by Jeremiah Owyang, a respected blogger and strategist with the Altimeter Group, looks at how insurance companies will perform lifestyle reconnaissance via social media for clues on risky or healthy behavior, and adjust policy rates accordingly.
On the surface, it seems like a proactive move for health insurance companies, but the article points out several obvious challenges as customers wise up to nosy insurance providers. With plenty of legal, privacy and insurance marketing concerns unresolved, the ramifications are just starting to be hashed out.
The most interesting part of the article was Mr. Owyang’s conclusion on how the various “Social CRM techniques” could evolve into full-fledged, opt-in wellness programs sponsored by insurance companies that could result in reduced “Social Insurance Rates.”
“I would expect health and insurance companies to offer an opt-in method for existing wellness programs to be extended to tools like online education courses, participating in wellness programs with peers (like Nike Plus) or allowing members to submit location based checkins to the gym, healthy eating, and other pro-health activities,” writes Mr. Owyang. “We should expect that a forward-thinking insurance or wellness company offers an online incentive based program to encourage members to connect to each other, become more educated, and live a healthy lifestyle.”
While socially connected wellness programs like the one described may be years away, the vision of insurance companies incentivizing a healthy lifestyle monitored via the web sounds both promising and a bit scary. Do we want our health insurance companies to have even more personal information just to save a few extra bucks?
On the flip, few people will object to living longer and spending less on insurance as long as it doesn’t require a huge effort, and it seems wholly possible that opt-in wellness programs could achieve mass appeal among the health conscious who are already engaged on the social web. With the right promotion, these programs could even be a valuable image boost to an industry with a perpetual black eye.
Wellness programs already exist through some group health insurance plans, but the challenge will be scaling it up to accommodate millions of individual and family plans as health care becomes more readily available (mandatory?) by 2014. The fact that health insurance companies are still figuring out the social web combined with the vast resources necessary to process all this new data will create its own set of challenges.
Health care reform has created an “arms race” of sorts between health insurance providers positioning themselves for a windfall of customers as the legislation takes shape, while weeding out the unhealthy. Even with the challenges, playing to an increasingly social and plugged-in population is hardly a risk.
PART II – Insurance Risk and the Social Web, Keep Digital Foot out of Mouth.
August 25, 2010 at 7:12 am
There are already insurers in the UK making use of this sort of opt in health plan and making use of social media. Also there is some evidence that the life-style review sort of activity is also already happening. We’ve popped some coverage on our blog of this and also published a report looking at insurers use of social media in general.
Very interesting subject.
August 25, 2010 at 7:31 am
Thanks for sharing Craig, I’m sure U.S. insurers have their scouts out monitoring the effectiveness of these UK programs and figuring how to adapt. For those who are interested, here is a link to “Leveraging Social Media, An In-depth View for Insurers.”
http://www.celent.com/124_2896.htm
I look forward to future Celent research on this topic.