Innovation in Insurance
NongHyup Life Insurance recently signed a memorandum of understanding (MOU) with KT to develop new insurance products and healthcare services by making use of big data and the Internet of Things (IoT). According to the MOU, the two companies are to launch a product for elderly people living in rural areas next year. This product is characterized by wrist watch-type smart bands checking their pulses, movements and the like and providing immediate notification for their families, the insurer, regional public health centers and so on if necessary.
The insurer’s plan is unlikely to go without a hitch though because legal guidelines have yet to be prepared with regard to whether insurers’ business is to be allowed to cover this type of healthcare activities. With the current Medical Service Act providing no detailed definition of medical activities, such healthcare services offered by insurers might be regarded as a violation of the act.
Nevertheless, an increasing number of South Korean insurance firms are showing their interest in the healthcare sector these days as the social demand for such services and products is expected to be soaring amid the rapid aging of the population.
In this context, Samsung Life Insurance and Samsung Fire & Marine Insurance are examining various plans nowadays. ING Life Insurance released a mobile application assisting in walking for exercise this month. Health management results obtained from the app cannot be directly linked to its insurance products and services yet. The purpose of the app is to interest and motivate customers in advance and then absorb them immediately once the scope of business of the insurer is expanded. Similar apps are available for AIA and Allianz Life Insurance customers, too.
“In the United States, products based on a combination between insurance and healthcare and health management services provided by insurers are already functioning as profitable business models, contributing much to a decrease in medical expenses,” Lina Life Insurance explained.