By Tom Murray, Head of Product Strategy, Exaxe.
Along with this ability to get far better finessed averages across the population came the possibility of finessing far more individual based dissections of the general population, as increases in computing power made this kind of statistical analysis economically feasible both to do and to maintain.
The willingness of the population to wire themselves up and allow large scale monitoring of their health and well-being has been nothing short of amazing, and the fact that the vast amount of this has been voluntary was not foreseen in even the most dystopian of futuristic novels from two decades ago. Fitbits, and similar systems, now provide an endless stream of real-time data on how the person wearing them is reacting to day-to-day stimulus. The resulting personalised data allows far more precise assessment of their individual risk, and therefore far more personalised insurance premium charging, which can even be varied depending upon the activities being undertaken.
However, with all this comes the dystopian vision of how those who get the information use it. The possibility of abuse of this information is very clear and has been worrying those who regulate the protection of individual data for quite some time. After a lot of research and discussion, the European Union, which tends to lead the world in terms of the protection of individual rights, finally produced new regulation, which will come into effect next year – the General Data Protection regulation. This new regulation (GDPR) is designed to ensure that the individual is fully aware of the data that is being captured about them, the use to which it is being put, and forces the data gatherer to get explicit consent for each and every use of the data.
This is fine in theory but it may inadvertently cut across some of the most innovative changes in the insurance industry that has occurred in recent years, namely the better pricing of individual risk thereby giving the reward of cheaper insurance to those who do more to reduce the risk of serious illness or death by maintaining a healthy fit lifestyle. And as it does so, it is endangering a large number of high-tech start-ups focusing on the booming health gadget market.
The big issue is that the real-focus of these start-ups is the lucrative corporate health market. Out of fear of how the information could ultimately be used, the EU’s Article 29 working body, which is composed of the data regulators of the 28 states, has ruled that employers should be banned from issuing their staff with fitness monitors of any kind, even if the staff have consented to it. According to the working party, employers would also be banned from accessing any data from these monitors, even if it is merely aggregated information applying to the whole work-force rather than individualised information about specific employees.
This news is shattering to the software industry, which foresaw a lucrative market in corporate fitness systems which helped both the individual to understand their own health and the employer to encourage staff to live healthier lifestyles, and thereby reduce the overall costs of the insurance benefits that most corporates include as part of their employment packages.
Corporate ‘Wellness’ programmes are becoming increasingly popular and are seen as positive by both employer and employee alike but the EU data commissioners believe that the relationship between employer and employee is so unbalanced that it is not possible for any consent to be legally valid as far too many employees would not feel capable of saying no to the sharing of the data with the employer and would also be vulnerable to peer pressure to join in the programme.
While each individual country can opt out of this interpretation, as the ultimate guidelines will be set out at a national level, clearly a majority of the countries are already indicating that their national legislation will not permit this market to happen. With it, one of the key benefits of this kind of technology will be restricted and employers, and ultimately employees, will pay the price. Individual data protection is very important but the data commissioners seem to feel that all corporate use of data about their employees is inherently wrong, and therefore needs to be controlled. A very promising industry that can deliver major benefits to the overall health of society risks being strangled at birth by the red tape that is supposed to be protecting that same society.
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