RISK ASSESSMENT
Insurers use tracking tools to mine real-time customer data
New York — Twice a day, Scott Ozawa’s Bluetooth-enabled toothbrush tells his dental insurer if he has brushed his teeth for a full two minutes. In return, he gets free brush heads and the employer which bought his insurance gets premium discounts. The scheme, devised by Beam Technologies, is just one example of the latest uses of technology by insurers hungry for more real-time information on customers, which they say allows them to assess risk more accurately and set rates accordingly. In theory, everybody wins, as policyholders adopt better habits and insurance companies save money on claims. Cherry-Pick the Best But there are concerns that insurers will eventually use the data they get to cherry-pick the best and most profitable customers, while hiking rates or even denying coverage to people who choose not to participate. "It’s not expected today, but in the near future, it will be used to penalise people," said Novarica’s Mitchell Wein, who advises clients on insurance technolo...
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