Rapid digitisation in the medical space is a boon for insurers

Dr Marion Morkel, chief medical officer at Sanlam.

Digitization is sweeping through the medical industry way faster than any scientist would have predicted few decades ago. Children born today may not know what it feels like to catch a common cold. We can no longer rule out the possibility that a digital device will warn them to increase their vitamin C intake long before the first symptom is felt.

Far from this scenario being years away, the future is already here if we consider that:

• Robot doctors can perform complex brain surgery in two and a half minutes.
• Virtual Reality is being used as an alternative anaesthetic
• Robotic counsellors are helping treat post-traumatic stress disorder.
• Diabetics can utilise a microscopic contact lens to detect glucose control and feed live reports through to an app, which then triggers the automatic release of insulin from a pump inserted into the abdomen.
• ECGs and X-rays can be done via smartphone, and results are immediate and cheaper.

What does this rapid pace of digitization in the medical industry mean for insurers? Multiple global companies are busy putting resources towards eradicating cancer and using technology to make treatment more affordable and accessible. This has big implications for insurance – both from an underwriting perspective, to evaluate risk, and in terms of resource allocation.

Medical records will soon be online and accessible for individuals to share with a professional in the health or insurance field if they wish. Paper-based forms will soon be a thing of the past. Big Data will capture individuals’ entire medical history and make it accessible via smartphones in a matter of minutes. Medical care will be more accessible than ever before, and insurance products will be better tailored to give people exactly what they need.

Online activity is also giving insurance companies unprecedented insight into what individuals really need. If you’re a runner and see that you’ve signed up for a major race, we know you could be interested in insurance that covers you against accidents and injuries for the event’s duration. We as insurers are therefore able to offer increasingly relevant products based on people’s activity online.
The use of apps and wearable tech by young people is changing the nature of fitness and insurance through gamification. International studies have shown that a reward-driven approach lowers the incidents of claims. People become increasingly conscientious about daily exercise routines. This will be a fixture of the future. The digital world will be increasingly linked to rewards in the insurance realm. Positive incentive schemes will benefit both the insured and the insurer.

That said; delivery of these innovative IT medical systems to consumers is not without challenges. Regulation of devices and technology becomes a huge concern. It is difficult for customers to discern the genuine technology from bogus quick money making schemes. While global health organisations are looking at this, the explosion is so rapid. Regulators find themselves always playing catch-up. In the insurance industry this unregulated market poses challenges at both underwriting and claims stage. At underwriting, there is concern that customers will anti-select against companies, as this technology allows them to be diagnosed without any medical history records. At claims stage, providing results from these sources without support from medical specialists may also result in legal recourse when claims are declined.

Furthermore, the delivery of diagnostic answers to the individual without sufficient medical support and counselling has also been a huge source of contention. The sale of genetic testing to the public in USA is an excellent example. Some of the results were devastating to individuals and also misinterpreted.

Lastly, the lack of human interaction in this new world is a challenge. In times of health challenges and adversity, human touch is central to the healing process. The move to a world where robotics replace humans, should not replace the need for the human interaction.