How can big insurers, new tech-focused players work together?

WINNIPEG — While traditional insurance companies and some of the disruptors coming on the scene would presumably be fierce competitors, there’s lots of room for them to work together, participants at the Canadian Pension and Benefits Institute’s national forum heard.

“The insurance companies are late bloomers when it comes to the digital world,” said Lisa Callaghan, vice-president of strategy, marketing and communications at Manulife Financial Corp., during a session on group benefits and technology platforms at the event in Winnipeg on Tuesday.

As Callaghan pointed out, digital technologies and new platforms are disrupting the insurance industry in a number of areas. While she noted emerging platforms have a role when it comes to insurance products and operations, the impact will be particularly significant on the distribution side. New players, she noted, often enter the market as providers of certain human resources functions by, for example, helping employers deal with issues such as attendance matters, and then move into services like payroll and benefits enrolment. Other developments include instantaneous quoting systems for group benefits products and apps that create an e-commerce-type of experience for plan members by giving them more choice and control.

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But when it comes to marketplace approaches that provide that choice, Callaghan cautioned that the group benefits industry can learn from the experience of its retirement counterparts in offering investment options to plan members. “More choice isn’t necessarily better,” she said, suggesting that plan sponsors would still want to consider the overall goals of their benefits plan even as they make more options available to their members.

What’s key, said Callaghan — whose company was part of a group of investors in a US$25-million round of financing in digital health platform League last year — is for the big insurers to work with the new technology-focused players. “I choose to look at it as an opportunity,” she said, noting she expects to see a blending of insurance companies and the disruptors.

Digital platforms, of course, are just one of the many ways new technologies are changing the health benefits industry. As another speaker at the event noted on Tuesday, the field of precision health is developing rapidly. Whereas it previously took massive sums and years to sequence a genome, it’s not possible to do it in a day at a cost of $1,000, said Robert Fraser, president and chief executive officer of Vancouver-based Molecular You Co. The result, he said, is a much greater ability to use individuals’ health profiles to determine the best course of action for their circumstances.

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While the focus is often on genes, Fraser noted other factors, such as proteins, can also be significant. He gave the example of a cancer patient deemed to be terminally ill who had been having no success with chemotherapy treatment. It turned out the cancer was due to a particular protein that it was possible to inhibit with a treatment for high blood pressure. “They found out that all that chemotherapy was having zero effect on that individual,” said Fraser, noting the patient recovered.

With inappropriate and ineffective drug prescriptions a common occurrence, Fraser said more targeted approaches hold significant promise for reducing adverse reactions to medications and improving health outcomes. ”There’s big benefits of implementing pharmacogenomics in practice,” he said.

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