To consider life insurance, you have to acknowledge the possibility of your own demise – a downer, to say the least. But what if the focus was shifted from dying to living?

That’s the innovative idea behind John Hancock’s new Vitality program, which offers discounts of up to 15% on life insurance premiums (and other rewards) if you live a healthy lifestyle.

https://www.youtube.com/watch?v=iJWGlYGB1bY

Wearable-enabled
What’s driving this new behavior-based insurance model? Wearables like the Apple Watch, Up by Jawbone, and Fitbit, which John Hancock will give you for free. Working with the Vitality app, a wearable device can track your activity to see if you’re doing what’s required to lower your premium, like working out a certain number of times.

Big helper or Big Brother?
While some have expressed privacy concerns about all this personal health and fitness info being stored in an insurance company’s database, there’s reason to believe customers will be receptive. For one thing, pricing based on user actions, rather than a static profile, has already proven successful in the car insurance business.

Using sensors installed in vehicles, insurers have programs that can monitor drivers and reward them for avoiding hard braking and other bad habits. Progressive’s Snapshot program, for one, has attracted more than one million customers.

Just the tip of the iceberg
With two-thirds of insurance company executives expecting wearable tech to have a major impact on their industry, we think initiatives like Vitality have a ton of potential. It all depends on how well their marketing can explain the programs and persuade people to engage in these new behaviors.