In Part-1, ecosystem characteristics and successes in digital health were discussed. In Part-2, the focus turns to Discovery’s Vitality health ecosystem.
In September ’18, John Hancock declared that it would discontinue traditional life insurance and instead offer only its Vitality branded interactive health policies. This announcement was newsworthy at the time, as behavior-based programs such as Vitality had begun to transform insurance into clickable media content. As a leader in this market, Vitality provides pertinent insights for self-tracking in health insurance. Discovery Limited, a 1992 founded South African financial services group, became the largest health insurer in South Africa at the turn of the century. It soon initiated an international expansion spree centered on Vitality, a health promotion program comprising financial and non-financial incentives. The core proposition: resulting healthy behavior lowers rates of healthcare consumption and the price of cover.
Discovery’s approach resulted in record reductions in health costs as well as policyholder mortality. The success helped it replicate the model in 20+ markets through an ecosystem of partners with global insurers such as Ping An, AIA and Sumitomo Life in Asia; John Hancock and Manulife in North America and Generali in Europe. While retaining the core tenets of motivation and reward, the model was fine tuned for each geography, aligning with nuances of wellness, business models and regulatory contexts.
In the past year, Vitality Group’s profit increased by 38% to US$27.1 million. Fee income grew 14% and insurance partners’ Vitality-integrated premiums grew by 26% to US $1.3 billion, as Vitality expanded to 30 markets. Membership from partners grew 33% to 2.4 million with total membership touching 4.4 million.
The central brand value hinges on three pillars: behavioral assessment, improvement and reward. Members opt for standard assessments including blood pressure, cholesterol and blood sugar combined with a review of individual nutrition and wellness habits that result in Vitality points. By completing a Vitality check, customers earn up to 28,000 points. On meeting weekly fitness goals, customers can choose gifts between 150-750 Discovery Miles, which can be redeemed for rewards like coffee or smoothies, or be saved to purchase larger rewards like plane tickets. For those that meet Vitality goals across Health, Drive, and Money, more attractive rewards are offered.
The Vitality Drive incentivizes vehicle insurance customers for safe driving behavior, using advanced telematics technology to track driver behavior. Vitality Money is offered by Discovery Bank, which rewards risk-averse financial habits like making long-term investments, purchasing insurance, and other “healthy” behaviors.
This shared-value insurance model has delivered superior value for clients, with much improved actuarial results for carriers, besides promoting a healthier society. The overarching strategy has been to pursue adjacencies while building arguably, the world’s largest behavior change platform. This strategy is most evident in cases like Ping An Health, where Discovery has a 25% equity partnership with China’s Ping An Group. In 2021 first half, this business segment witnessed a 62% growth over first half of 2020.
In the case of Generali Vitality, the program has engaged both retail and corporate customers across Europe in their journey towards healthier living. During the COVID-19 pandemic, there was heightened engagement as exercises and a healthy lifestyle reduced the risk of hospitalization, even for those with comorbidities.
Discovery continues to invest in innovation, as demonstrated in its latest Connected Care platform that connects members to a range of home-based services. Virtual consultations are remotely guided by a doctor through connected TytoHome devices, which relay live feeds of clinical-grade images for more accurate diagnosis. Members receive post-consultation feedback such as EHRs, e-scripts, treatment plans and referral appointments. This engenders a coordinated care pathway suited for members who need to better manage their chronic conditions.
In the final Part-3, other dominant players such as Manulife with a different tack to health ecosystems, are elaborated.
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