The Insurance Regulatory and Development Authority of India (Irdai) recently formed a working group to examine innovations in insurance involving wearable or portable devices. “In the context of both health insurance and life insurance, wearable devices could be used to measure personal fitness, (and) incorporate a healthy lifestyle…,” the regulator stated in an order earlier this month.
It has already recognised the role of wellness aspects in risk assessment and product design in its health insurance regulations issued in July 2016. According to these, general and health insurers are allowed to devise mechanisms or incentives to reward policyholders for preventive and wellness habits. While insurers cannot offer discounts on any third-party products, they can offer discounts in premium or benefits on diagnostics, pharmaceutical or consultation services from their network providers.
Such discounts in premiums or allied services are not currently allowed in life insurance. But Irdai's recent working group, which includes life insurance representatives, is expected to examine the impact of new technologies like wearables on pricing of insurance. Use of telematics in motor insurance is already recognised.
