Are customers willing to share wellness data with their insurers?

One in three people uses an activity or health tracking wearable device, according to a National Heart, Lung and Blood Institute (NHLBI) survey. While 80% of these survey respondents said they would share their data with a doctor to monitor health, other research suggests that individuals are not as likely to share their information with insurance providers.

In LIMRA’s 2024 Insurance Barometer Study, 40% of Americans said they would participate in a life insurance wellness program that exchanges health or activity data for discount incentives. This percentage has increased from 30% in 2016.

Steve Wood, LIMRA research director of consumer markets, wrote to Digital Insurance, “In general, apps, smart phones, and social media have become more ingrained in our everyday lives. I think apps, in particular, are so widely used and with each, we give up some personal data. Our name, email, DOB [date of birth], phone number and whatever habits [or] usage of the app’s maker. And many apps provide rewards. The model is there, on everyone’s smartphones already.”

Wood added, “A significantly larger percentage of adults (the Barometer survey is [the] general population) have grown up with smartphones, apps, and these types of programs. Remember these aren’t necessarily people who will join a life insurance wellness [or] incentive program, it’s

just people who say they would.”

LIMRA did not change the question asked to respondents between 2016 and 2024, Wood noted.

Gen Z, Millennial and Gen X individuals are more likely to share data from wearables or activity trackers with their life insurers for a financial incentive, compared to those in the Baby Boomer generation. More than half, 51%, of Millennials, 42% of Gen Z adults and 41% of Gen Xers are very likely or extremely likely to wear an activity or health tracker and share data with an insurer. Only 30% of Baby Boomers responded the same. 

On why interest is higher among Millennials and Gen Z adults than in Gen Xers and Baby Boomers, Woods explained, “Millennials have grown up more in the advent of data sharing and rewards programs. They also tend to feel more confident about their health and gym attendance than other generations. We expect Gen Z to have similar feelings as they age and mature.”

He added that data privacy is still a concern for younger adults, but that Millennials and Gen Z view data sharing as less of an intrusion and that Millennials in particular are more likely to view their data as more of a commodity. 

Older people in the U.S. express data privacy concerns more so than others: 53% of Baby Boomers responded with such concerns, compared with just 39% of Gen Zers and 46% each of Millennials and Gen Xers.

The Insurance Barometer Study also noted two types of incentive programs of interest to consumers, which would involve sharing data with their insurance providers: active sharing programs and passive sharing programs.

Participants of active sharing programs would actively share their activities and health behaviors, such as fitness activities or doctor visits, with the insurer. Two-thirds, 66%, of consumers who are interested in an active sharing program said savings and discounts would be the main reason for participation, and the 46% of respondents who had no or little interest cited privacy concerns as their top reason not to participate. Half of Millennials had interest in the program and were more likely to participate than any other demographic. Only 30% of Baby Boomers and 39% of each Gen Xers and Gen Zers responded with interest.

Passive sharing programs involve the passive sharing of activity and information between the participant and insurer. This could include data from activity tracking wearables like heart rate or steps walked.  Sixty-five percent showed interest in a passive sharing program, but 46% said this would be sharing too much personal information with an insurance company.

“Among life insurance owners, 44% say they would be interested in these programs, and among those who purchased policies individually (not through an employer), it is 45%. There may be some self-selection at work here (healthier people are able to purchase these policies), but we can’t know,” states Wood. “The COVID-19 pandemic made more people aware of their health and the importance of taking care of themselves. Sixty-five percent of consumers who say they would participate in a ‘passive sharing’ wellness program said the top reason was [that] such a program would help establish activity goals and help make healthier choices.”

Wood advises that building trust in the consumer-carrier relationship is paramount to address privacy concerns. 

“Build trust and transparency – securing client trust is the most important factor in any life

insurance shopping experience. Trust is everything, really,” writes Wood. 

“An insurer must be careful about ‘too good to be true’ offers, as consumers have grown cynical of such promises. It’s all about trust and relationships. That applies to all generations and all demographics. Life insurance is a unique product in that it hasn’t really succeeded in a direct-to-consumer online sales model as most other goods and services have in recent years. It is also one of the most personal products to sell – often requiring detailed health information, financial information, health information about relatives, fluid draws, and discussions of mortality. This is very difficult to do in an entirely online environment,” Wood said.

“But younger generations are slightly more likely to share private data online. They say they are ‘concerned’ about data privacy, but what does that mean?  It appears that generally healthy, generally younger adults are more willing to trust a company’s app in order to obtain savings or rewards as incentives,” explained Wood. ” Lastly, it is my contention that the more a consumer  understands life insurance, the more he or she would be willing to agree to these programs. A life insurer wants its policyowners to live long and healthy lives, and these programs help people with that goal in mind. It’s a ‘win-win’ for policyholders and insurers.”