Have you hit your 10,000 steps today?
That milestone could earn you some reward points and major savings on your life insurance premiums, based on a new program from John Hancock and wellness company The Vitality Group. Thanks to wearable devices like Fitbit, the company can track their policyholders' activity, using the information to provide what they say is more accurate pricing on their universal and term life insurance policies.
"We've been trying as an industry I'd say to get people to be more engaged with life insurance products. The program basically works by saying if you stay healthy, you're going to live a longer, healthier life," said John Hancock Insurance President Michael Doughty. (Tweet this)
"That's good for us as an insurance company, and it's also good for you," the executive told CNBC in an interview.
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The program is set up similarly to frequent flier mile programs, with participants who exhibit healthy behaviors earning more points.
To get started, policyholders who opt into the program receive a free Fitbit that begins tracking their physical activity. The program also tracks other activities such as doctor visits, biometric results and flu shots.
Specifically, policyholders who reach 3,500 points are considered silver status and receive roughly 5 percent off their premiums. Gold is 7,000 points earned, with 10 percent off and platinum is 10,000 points, equalling a 15 percent discount.
This type of dynamic pricing could lead to lower costs for customers, but it raises the question of whether consumers are willing to relinquish more of their privacy to life insurers.