Consumer expectations havedecidedly pivoted towards an e-commerce experience that guaranteesvalue. Yet, in spite of the high level of complexity, healthinsurance have largely remained the exception — until now. Beloware three lessons health insurance incumbents can learn from theauto insurance industry to better meet customer expectations, boost sales, and ensurelong-term competitiveness.

One price doesn't fit all

Auto insurers like Progressive, Allstate, and StateFarm are using the Internet of Things (IoT) to monitor behavior —driver habits, changes in speed, how often they drive, and the timeof day they drive are just a few examples. The hope is that doingso reduces costs by more accurately pricing driver risk. Forconsumers, this is a strong incentive to drive well and maintainlower premium rates.


This behavior-based model is a great example forhealth insurance companies in their product and pricing models forhealth plans. Walking 10,000 steps a day, getting an annualcheckup, and other health-related behaviors can be a goodindication that overall health can be incorporated into innovativebehavior-based health insurance products.


This is particularly appealing to millennials, forwhom wellness is a daily activity. Recent Goldman Sachs research indicates thatmillennials are exercising more, eating better, and smoking lessthan previous generations. This generation is using apps to tracktraining and nutrition data, which can be incorporated into riskassessments to help insurers stay competitive. This data alsopresents insurers with more opportunities to incentivize healthybehaviors by rewarding members who reach certain milestones.

Insurance shopping has to be an onlineexperience

Insurance is complicated, and there are many factorsthat go into understanding the value of coverage. For consumers,choosing the best plan for your needs is much simpler whenmarketplace comparisons can be made. In the auto insurance world,such comparisons exist. For example, NerdWallet allows users tocompare quotes from multiple car insurance companies at once.Comparing exactly what is being offered — and at what price —simplifies the process of choosing a provider and plan.


Similarly, consumers would greatly benefit from healthinsurance marketplaces where they can get educated, view quotes,and enroll in plans within minutes. Easier-to-understand productinformation, reviews, and price comparisons should guide thetransition to a marketplace model for the health insuranceindustry. Considering that we may soon see more short-termplans and association health plans (which are not as comprehensive)alongside standard plans, it is especially important for consumersto understand exactly what they are purchasing and what serviceswill be covered. An e-commerce platform would help ensure thatconsumers are actually comparing similar plans that will providethem with what they need.

Empowered agents can make personalized recommendations

Auto insurance companies such as Goji and CoverHoundoperate data-driven platforms that help agents match customer needswith the correct coverage through integrated networks of insurancecarriers. In the health insurance industry, there is a similaropportunity for carriers to enable their agents to find morepersonalized options for customers at a fraction of the time ittypically takes.


Brokers add value to the health insurance experienceof many consumer segments, and there is a lot more agents canincorporate into their recommendations through technology. Forexample, a small business owner in the retail industry might wantto know what other similar companies in the area have purchasedbased on their demographics. Through better use of data at thepoint-of-sale, a broker should be able to make those suggestionswith ease.


Streamlined e-commerce experiences and improved valueare key for consumers across industries, including healthinsurance. Health insurance providers would benefit fromincorporating things that the auto industry has been doing wellalready — using technology to incentivize healthy behaviors, havingeasy-to-understand information available on marketplaces, andutilizing data to help agents show personalized offerings.

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

  • Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and events
  • Access to other award-winning ALM websites including and

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.