Life Insurance coverage Health Rewards | Cash

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F.For years, health insurances have offered perks such as Fitbit or a free gym membership as a reward for training. Life insurance is now increasingly coming into play.

The trend towards what could be called “Insure Fitness” began about five years ago when John Hancock launched his VitalityPLUS plan, which allows you to earn up to 25% off premium. Now the online broker Health IQ is saying that it is also offering such breaks to its healthiest applicants. Another such broker, Sproutt, says it will shortly be launching policies that offer up to 20% benefit on fitness activities, either through a discount on premiums or a “free” increase in death benefit.

Aside from the policyholder benefits, the programs make good business sense, says Brooks Tingle, CEO of John Hancock. “They are the life insurance equivalent of discounts for good drivers on auto policies – a reward for those customers who embody less risky behavior.” And many more insurers will soon join in, says Jonathan Godsall, partner at McKinsey & Company. He sees incentives for a healthy life as “the most important trend in life insurance for at least a decade” and predicts an industry-wide introduction of fitness and healthy behavior as an assessment factor “within three to five years”.

Even if your insurer doesn’t already have such a program, it is beneficial to know how the current incentives work and how the growth in insurance eligibility could benefit you now or in the future.

This is how the plans work

Activity-based life insurance programs require more information to be shared with your insurer than the usual medical data or exams – specifically details of your exercise, eating and sleeping habits, either reported to yourself or through wearable monitoring devices such as Fitbits and Amazon Halos.

The experts we contacted for this story all reported a high level of customer satisfaction with such an exchange, especially if there are incentives for it. And when data has to be reported on their own, “people have a strong tendency to tell the truth,” says Assaf Henkin, CEO of Sproutt – in part, he says, because they may know the importance of accuracy when applying for life insurance, since they are faking the facts, it can complicate matters later.

Here are details on three of the most important programs:

John Hancock vitality

Tingle correctly describes his company’s plan as a “life insurance frequent flyer program,” but with rewards for healthy behavior rather than miles flown or dollars spent on an airline. All John Hancock customers have the option to automatically sign up for the Vitality GO program at no cost at the basic level of bronze membership. In this way, points can be collected for workouts and other positive behaviors, the data of which is usually automatically fed to the insurer via the Vitality app. For example, you can collect 10 vitality points every day for walking 5,000 steps and 30 points for a 30-minute workout at home or in the gym.

Collecting 3,000 points grants an upgrade to VitalityPLUS. (This benefit is also free if you have a term policy with Hancock, or an additional $ 3 a month if you have a permanent policy.) You can then enjoy discounts such as 25% off healthy groceries at thousands of grocery stores says Tingle. and are eligible for premium discounts. Upgrading to Silver through your healthy behavior could lower your rewards by 5 to 7%, he says, while earning Gold status increases the discount to around 10% and reaching Platinum status gives you up to 25% off.

Tingle says the most rewarded members of the program aren’t actually “triathletes and the like.” Instead, he says, they are more likely to be “average people” who are less healthy at the beginning of the program and then take measures to improve their health, such as quitting smoking or losing weight to better control their diabetes.

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