Trade Your Health Secrets for a Life Insurance Discount?

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Dumb Insurance Buys

By Karla Bowsher

First car insurance companies started offering discounts to customers who allowed them to track their driving habits. Now a U.S. life insurance company will offer discounts and other rewards to customers who allow them to track their health habits.

A new partnership between John Hancock and Vitality Group gives policyholders "opportunities to significantly save on their annual premiums and earn valuable rewards and discounts for taking steps to improve their health."

Vitality Group provides an incentive-based wellness program to employers seeking to reduce benefits costs. Vitality is partnering exclusively with John Hancock to introduce the concept of incentive-based wellness programs to the life insurance industry, according to a news release.

Privacy Issues

The New York Times reports that John Hancock is the first U.S. life insurance company to offer such a program, which raises privacy issues: "The concept -- which has been used in South Africa, where Vitality is based, Europe, Singapore and Australia -- has the potential to transform the way life insurance is priced, at least for consumers who are willing to continually share their health data. But it also raises questions about how that information will be protected - and whether it could be used in ways that ultimately work against a consumer's best interests."

The first step in participating is taking an "online Vitality Health Review," which will determine a policyholder's "Vitality Age, an indicator of overall health that may be higher or lower than their actual age, which can improve over time as they work toward living a healthier life." According to Vitality Group, most Americans are five years older than their actual age on average.

Policyholders will also receive a Fitbit fitness tracker, essentially a high-tech pedometer intended to be worn on the wrist like a bracelet throughout the day and while sleeping.

In addition to insurance breaks, John Hancock states that discounts and rewards that policyholders stand to earn would come from companies like Amazon, Hyatt and REI -- "just for walking, having regular check-ups and engaging in other everyday healthy activities."

Would you participant in a program like this if reduced your insurance rates? Let us know what you think in a comment below or on our Facebook page. Like this article? Sign up for our newsletter and we'll send you a regular digest of our newest stories, full of money saving tips and advice, free! We'll also email you a PDF of Stacy Johnson's "205 Ways to Save Money" as soon as you've subscribed. It's full of great tips that'll help you save a ton of extra cash.
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