Alan Martin: Why Insurers Who Invest in Wellness Win — The Healthcare Innovation Playbook still works

Most insured wellness programs don't actually make anyone healthier. They reward the people who were already going to the gym. They ship step counters to triathletes and the policyholders who actually need support, they get ended, a nurse support line, nobody calls. It is wellness theatre dressed up as risk management. Welcome to Scouting for Growth. I am Sabine van der Linden, and this is the show where we unpack over the next few weeks how the insurance intelligence layer gets built one frontier firm at a time. My guest today is Alan Martin, chartered insurer, founder of Resilient Risk and Health Solutions, 33 years inside life and health, claims, underwriting, pricing, portfolio management, and the architect of one of the first ever health and wellness modifiable risk strategies. Alan and I also sit on the advisory board of the Care Voice together. So this conversation has been simmering for a while. In the next 45 to 60 minutes or so, we are going to talk about why the protection gap keeps widening, even as insurers pour millions into wellness hubs. We are asking what authentic modifiable risk actually looks like at scale. And we are ending Alan a blank canvas. If he could rebuild life and health insurance from scratch tomorrow, no legacy, no sacred cows, what would it be? Buckle up. This one is super sharp. Alan, welcome to Scouting for Growth. Hi, Alan. Thank you so much for joining me today. How are you? I'm very good. Thank you. And yourself? I am well, you know, long day, but so excited that we are going to talk about the future of healthcare with you. Yeah, absolutely. It's great to be here and it's a topic I'm really passionate about. So it's lovely to discuss it with you. So let's get started with some introduction, Alan. Tell us who you are, what you do every day, where you're coming from, because I know you from, you know, the corporate world. perfect well so i worked in life and health reinsurance for 34 years a technician so underwriting claims developing products with insurance companies so all of the technical aspects of life and health insurance and in recent years insurers rightly have started to focus on how do we engage with our policyholders about their health how do we engage with insure tech and with health tech. And I was doing a lot of that in the corporate world. And I realized there was a bit of a disconnect between insurers and the wonderful tech world. And so I decided to set up my own business and act as a bit of a translator between those two industries. Tell us the name of your business. You said you are a translator. Tell us a bit about the proposition you're actually putting to market after leaving a big corporate insurer. Yeah, indeed. So the business is Resilient Risk and Health Solutions. So focused on life and health insurance and that intersection between insurance and health care. So we all know there's a natural alignment of interests between a life insurer, a health insurer and the individual. The individual wants to live a long, happy, healthy life. And the life insurer also wants them to live a long, happy, healthy life. There's a very kind of natural alignment of interests. This isn't news that the industry has been aware of this for a long period of time. But the industry has really struggled to find ways of engaging with customers, find adequate ways of supporting people to manage their health better so that we prevent claims, mitigate claims and enable people to live healthier lives. And in the corporate world, when I worked for a reinsurer, I had an opportunity to work with insurers trying to solve this problem. I had the opportunity to work with health techs trying to solve this problem. I even did some work in the public sector. But it's quite clear to me that not everyone's speaking the same language. Health tech companies don't understand insurance. Why should they? And insurance companies don't really understand the tech world as much as they think that they do. And so I felt that if we're going to, as an insurance industry, step forward and do all of the things that we've been saying for decades that we want to do to support people to improve their health, to improve societal health, and of course, to improve the profitability of insurance, I needed to step out of that world and support health techs and insure techs to correctly navigate the market and to articulate what they're capable of doing to an insurance company in a way that the insurance company understands. and to help them understand insurance so that we can, you know, fulfill that dream, if you like, of supporting people to improve their health. So interesting because you are building an ecosystem in some ways, right? You have the insurer, you mentioned governments, who are looking at regulation and the health sector come together to actually start solving a specific gap. Can you tell us what is the size of the gap you're actually identifying in the market? And what was really the moment you saw the patterns compounding, becoming exponential in some ways? Yeah, so maybe your last question first in that. So that alignment of interest, we've known this for years, but it's been very difficult for an insurance company. Insurance companies aren't used to engaging with customers. I mean, life insurance is the most extreme version where you underwrite someone at the age of 28. You insure them for the next 40 years and, you know, there's very little communication that takes place. So insurance companies are a bit awkward when it comes to engaging with their customers and they don't really know how to and about and about what. Then in the background, there's been this growing theme. It started off in the medical world. It's now starting to creep out into the public consciousness around this very strong link between how you lead your lifestyle, how your lifestyle. are. So what you eat, how much you exercise, whether or not you smoke, how much you drink, all of these lifestyle choices that you make day in, day out have a huge impact on your health. And think of almost any chronic condition. There is a strong link to your lifestyle, whether that's cancer, Alzheimer's, diabetes, et cetera, et cetera, et cetera. So there's this growing body of evidence that says how you lead your life and the actions that you take day to day will have a very significant impact on your health. That's one proof point. Partly off the back of that, we've seen develop a huge ecosystem of wonderful health tech businesses, all who are focused on supporting people to manage their mental health, support people through cancer treatment, etc, etc, etc. So you've got the case, the need to take action. You've got the solutions that have been developed. The question now is how do we actually get that ecosystem of health techs to plug into insurance. Of course, in the background, we've got data, we've got AI, we've got all the tools that we need. And I think that has forced the industry now to take the topic seriously. So we know what problem we're trying to solve. We know that the solution is out there. And we're now just getting into that next phase where the rubber hits the road. And we've got to work out how we put all of those wonderful tech solutions to good work to get the ROI that the insurance company is looking for and to get the better health outcomes for the individuals. So we have seen those stats, right? 95% of AI projects fail. BCG has come as well for some research showing that 80% of projects within our industry, I believe, fails as well. So 20%, between 5% to 20% of projects succeed when you actually involve a tech company. But at the same time, you highlighted that our industry do not understand its customers, right? They are reliant on broker and nothing wrong with that. So how do we start transforming the behavior from the corporate viewpoint and enable the user, the customer to actually value their health and actually value the product of insurance in the first place? So that's a big question everyone's kind of grappling with. And there are multiple, like all wicked problems, there are multiple reasons why we've not crapped it yet. And one of them is insurance companies are very traditional. They sell through distribution channels, as you say. They're not used to engaging with customers. So there's quite a big jump to go from that life insurer who underwrites you and then pays out a claim 30 years later to actually thinking about engaging with customers and knowing what to engage with them about. I personally think that one of the biggest issues has been the fact that to get to that holy grail of supporting someone to manage their health as well as providing them with insurance we need to step into a world where insurance isn't just a financial services product that pays out money when something bad happens it's a product that provides you and your family with resilience and that is both resilience to disease as well as providing financial support to enable your family to be resilient when something bad happens and it's only really when you create that complete package of resilience that I think the lights really start to come on from a consumer perspective. What you've seen the insurance industry do up until now is come forward with a life insurance product and then strap some health services along the side. They're not an integral part of the product. They're not an integral part of the sale. Many people don't realize that there are health services provided with their insurance product. They may or may not I've been told that at the point of sale. So I think the game changer will be when at the point of sale, the person selling you that insurance product isn't saying this is something that's going to repay your mortgage, you know, should you get diagnosed with cancer. This is a product that would do that, but is also there in the meantime to support you to manage your health and your family's health. Because ultimately, you know, why do you buy life insurance? You buy life insurance to protect the family from the financial impact of one of the breadwinners in that family from passing away. Well, the best way of protecting the family is to make sure that they don't actually pass away. And I think if you can focus the consumer's attention on that much warmer, more engaging aspect of why you should buy insurance, we have the opportunity to grow the market significantly as well as add a lot more value to them as individuals and at a societal level as well do you know the story of life insurance because we call it life insurance which actually about protecting death right yes indeed yeah it's crazy but there's you know look at um i like to draw analogies with other insurance products so fire insurance one of the original forms of insurance if you have a factory you need to insure it against the risk of fire. And one other thing, it's always been the case that once a year, the insurance company will send someone out to sort of audit and look at your building. Yeah. And of course, that does two things. First of all, it informs the renewal of your insurance and they can look at the risks and they can decide how much they want to charge you. But it also informs a conversation between the insured and the insurer around how you make sure that building doesn't burn down you know maybe you need a new sprinkler system maybe you've got the wrong cladding maybe your fire procedures are out of date yeah crucially the engagement between the insurer and the insured is 95 focused on how they jointly ensure that building never burns down and the insured knows should the building burn down well there's someone who can look after them. And so it's a kind of a slight flipping of the service offering. We don't really yet do that in life and health. Yeah. So you are working with a highly diverse group of companies, founders, as much as executives of large enterprises. And you also mentioned government and regulators. So that is highly diverse. So how do you bridge such different worlds, right? And where do their interests genuinely converge when it comes to building, as you said, offerings which are aligned to the need of the customer? So I think at a high level, everyone sees the alignment and sees that this is the right way forward. The devil's always in the detail, though, isn't it? So when you're sat down with an insurance company, they're always worried about putting too much cost into the product. And often it would surprise people, I think, how low some of the margins are for things like life insurance, for instance. And so they don't necessarily have a huge amount of money to play with if they're going to sell a product which is competitive in the marketplace. So there's cost considerations for the insurance company, albeit there are huge benefits that if they fully invested in health management and health and wellness, to the extent that they can see those claims improvements, then their business case would be looking very different to how it is now. And one of the big conversations I'm having with insurance companies is how they move from what currently is a fairly superficial provision of health and wellness services and a few things like virtual GP offerings and so on that don't really actually impact the risk. So they're spending lots of money out of their marketing budget and that hurts and and the conversation i'm having with insurance companies is how they can go from where they are today and track a path through to propositions that are much more impactful that genuinely create better health outcomes and therefore help them prevent and mitigate claims and for an insurance company if you can achieve that suddenly they start to see millions of pounds that they're going to be saving at the back end in terms of future claims costs. And that makes that business case conversation a hell of a lot more straightforward. The problem for them is they're currently sat there with a service proposition and contracts for the next 18 months, two years, where they're spending a lot of money on things that aren't really adding a great deal of value to them or the end customer. So when you start looking at those products and services, which may actually drive value to the end customer, can you give us some tips of what you've seen today driving value, either from leveraging the health tech and technology ecosystem or other mechanisms? Yeah, definitely. And I look at value from two perspectives. So one is how can you deliver services in the most efficient possible way? And the second, of course, the big one for the insurance companies is how can you save them money on claims, which is the big cost that sits in insurance products. So if I look maybe first at where, you know, there's types of services that don't add value from a risk perspective, which, by the way, you might still want to offer to your customers from a value proposition perspective. But we just need to have an honest conversation around the fact that they don't add an enormous amount of value. So you've seen insurers invest quite a lot in health and well-being services. And I do strongly believe that there is a form of lifestyle health risk management. I don't like the term wellness, by the way, because it it leans into that kind of shallow nature of of health engagement. But I do believe there is a health engagement proposition out there that supports people to prevent conditions through making changes and adaptions to their to their lifestyle, getting people to exercise more, getting people to eat the right things and so on. unfortunately insurance companies have tended to favor more superficial services that offering sort of nudges and rewards for doing 10 000 steps a day and and all this kind of stuff now it's not that that isn't directionally helpful but i think unfortunately what we've seen is that those companies are maybe attracting people who can already secure those rewards rather than reaching out to the more difficult group of people who most need support to manage their health And that for me is the trick in that prevention space to come forward with propositions where an ordinary person can engage and can get the support that they need to make the changes that maybe are more important for them to make than others and there are I think a growing number of of providers there's a company I was talking to just the other week called called Gojo who are there to support the ordinary joe yeah so the the normal person how do you motivate that normal person who is tempted to go and have a beer on a wednesday night who does maybe eat the wrong things that and who maybe doesn't go to the gym so how do you get that person to get up off their chair and to and to take a a different approach and how do you articulate to them why that's important and necessary. But then there's a whole range of other forms of prevention that are just as important and impactful on things like mental health, ensuring that people have really good access to high quality digital support around their mental health and a pathway that sits behind that. So as that condition becomes more severe and they require access to greater levels of support and maybe ultimately something like counselling. The journey automatically adapts to their need and their preference to ensure that they're given the support that's required. And I'm a strong believer in insurance of what I'd call a digital pathway. So there's some big risks that are really important to the insurers. You've got the cancer pathway, the mental health pathway and musculoskeletal, everything from physiotherapy through to really bad pain conditions. making your arts. Yes, exactly. Sitting on a chair like this. And I'm a big believer that if you, unlike most insurers' propositions today, where they tend to either do something at the front end around engagement and prevention in a light touch way, and then there's a bit of a void in the middle, and then at your time of need, maybe even as late as the point of claim, there are a series of claim, maybe a nurse hotline or a employee assistance program, but something that's quite reactive and appearing very late in the day, providing, in fairness, good levels of support. But that person would have benefited from help and support at a much earlier stage. And it's possible we could have prevented them from falling out of work or from that condition developing and from a claim occurring if we had had the opportunity to engage. But these services aren't sufficiently accessible. They're quite transactional. and you need to know that they're there and you need to know how to find them. And a lot of the really valuable services that insurers offer are still on a nurse phone line. They're still hidden in an employer's HR manual somewhere, so they're not accessible. And frankly, if you have anxiety, do you really want to pick up the phone and speak to a nurse that you've never spoken to before as part of your first step into getting that support. So for me, the really big game changer, and we look at the health tech world, and there are lots of wonderful examples of this, but providers who can create that end-to-end digital pathway, it's a digital-led process, there will be a therapist or a nurse or a clinician embedded in that process, but you have an accessible set of services that people can engage with. It will respond to need. It will respond to preference. You know, whether you pick up an ICBT module or whether you watch a video or whether you have a conversation with an avatar or whether you actually fall through to actually speaking to an individual, the right intervention happens for you. And there are some wonderful companies out there who I think over the next two or three years, you're going to see them take quite a big foothold in the insurance company and in my personal opinion hopefully replace some of the more sort of dated nurse phone line eap provider type services which i think are holding the insurers back from from really um supporting people in the way that they could do so earlier this week i was part of a webinar with majesco a platform which they have not only the life and health and pension annuity market but also pnc with an intelligent core meaning a core system which is ai native and cloud native and already having its own agents. And one key numbers that we talked about is the protection gap. Nine trillion protection gap. I tend to mention mostly the PNC protection gap, which is a 1.8 trillion protection gap. Well, I find out actually during this meeting that there's a 7 trillion protection gap in life, annuity and health. So you just mentioned that actually most of the life, products are designed for people like you and I, who probably do our 10,000 steps and know how to be on insurance, to actually the reason why we need insurance in our lives. But there is a major gap where people are not fulfilled or understand what products would be good for them. So I would like actually to dive into some of the solutions which are out there. For example, we know that we sometimes use parametrics to actually make it easier for some people with, you know, weather and cloud outage to get quickly some money back if claims occur. Are there mechanisms like this when we start looking at the protection gap and under covered, underserved markets? What is the innovation coming into your industry? Yes, I mean, that's a lovely question. I think there are a number of ways of looking at it. So one is the point I mentioned earlier, which I think to reach out into that underserved world of people who up until now haven't found the need to buy insurance particularly people of a young age you know if you're selling as you said life insurance is death insurance yeah so it's not a it's not an easy sale to a 28 year old or a 35 year old or someone who's just bought their first home that's quite a remote risk they're certainly not wandering around thinking of dying anytime soon so that's that's quite a jump and even products like critical illness and income protection or disability products to buy one of those products you've actually got to imagine getting value from it and if the only way you're going to get value from it is being diagnosed with cancer or the very or the very last thing yeah that's not very motivational is it so i think selling a contract that has that in the background but is more focused on supporting that person to manage their health throughout their lifetime them knowing i guess that they have that mental health support they have that access to good quality care pathways should they need them but also the more proactive stuff you know everyone knows that irrespective of your lifestyle when you're young you can get away with doing all kinds of things and it's when you get into your 30s and your 40s you start to put on a little bit of weight and realize you have to do something a little bit proactive everyone knows that's going to happen and so a policy that says look we're here for you for the long term okay and in the early years you're going to get value from this insurance product because we're going to you know based on whatever the latest science is telling us using the latest technology, wearables, whatever. We are here to support you to manage your health and the health of your family, to make sure that, you know, that factory never burns down in the life and health context. No one really sells insurance like that. And, you know, even companies like Vitality, they're still selling life insurance with the Vitality program on the side. No one's really selling this contract of resilience. And part of the reason for that, which frustrates me a lot, actually, is that the big insurance companies who have all of all of that money in the bank aren't really prepared to step forward and sell direct anymore. They all sit behind their distribution channels and they're very comfortable not being the person selling insurance, but essentially using an intermediary. And I think I think either that needs to change or someone from outside of insurance needs to come in and sell a proposition that leads with the health proposition and then has insurance inside. So it's almost like a form of embedded insurance, if you like, where you're embedding insurance within a health proposition. That could be where the major disruption comes from. In terms of accessing, I guess, gaps in the market where, so banks, for instance, used to be really good at selling insurance because they had bank branches. They had people in the bank branch. They had people going into the bank branch. And of course, that engagement was there. And then you could sell insurance. Whoever goes into a bank branch these days, is there even a bank branch for you to go into? So they've lost that sort of connectivity with their customers. But if we think of embedded insurance, there's absolutely no reason why you can't be selling a lot of what we within the insurance industry would know to be life insurance and critically honest insurance and disability insurance. There's no reason why you can't be enabling those products to appear within a bank account. Income protection will replace your income if you're unable to work due to illness. Another way of selling income protection if you're a bank would be to enable an option within your bank account for you to select your key outgoings that you would want protected if you became ill and for your bank account to essentially take a charge and to enable you to get that cover. I would know that that's an income protection policy in the UK, but the customer just sees that as an additional benefit of that their bank is offering them. So I think there are lots of things that we can do to make insurance appear in far richer, more appealing ways. Yeah, like embedded, right, embedded product services, embedded finance, embedded insurance. interesting example because when you know mobile phones came out and you know iPhones used to drop and then we used to break our screen you would get immediately on I mean in my bank account right my premium bank account I used to have free you know iPhone cover which would be I just had to take it yes and it was on my bank account and so it's interesting you're mentioning why not do that as well for life or health, because that would actually drive more value to the customer. Now, a question that comes to mind is you already mentioned the Gen Z, right? Some of the stats I've been reading recently is that 72% of Gen Zs are already searching, buying or trying to buy product and services on ChatGPT, even though, you know, I don't think we can actually close a deal on such platform yet, but that is 82% in the United States. And in recent months, I've had the opportunity to chair, host, moderate a number of providers' discussion with life health executives and identifying the ones who are the most innovative when they look at their product and services. When you look at that segment, what is interesting to them includes vision, includes dental, includes, you know, some of those care products that often is not that visible in the policy. Can you tell us some, when you start looking at the change in demographic, the change in the need of the customer, what other type of things an insurer or proposition need to consider to actually be much more aligned to what the customer wants? Yeah, definitely. So, I mean, I think where we go a little bit wrong in insurance, And I touched on it a little bit earlier. We think of insurance as being a financial product. Transactional. So it's transactional, but we believe that the main thing that we can do to resolve someone's problem is to pay them money. And in reality, when you think about what people actually need, it's much more service driven in my mind. Now, whenever I've done consumer research, particularly among younger segments of the population, things like getting support with your mental health is right up there as a major thing. Now, if someone is struggling with their mental health, paying them £2,000 isn't really going to help them out. and what does help them out is making sure that they get access to the support that they need whether that's viewing lived experience from other people like them which often isn't is enough in itself actually to help them to help them move move forward but accessing you know professional help support advice um if at all possible and it's really interesting um focused on the opposite end of the spectrum actually when i was doing a project on elderly care a few years ago but I think the point is still correct we did some consumer research on an insurance product that paid out amounts of money to support people with care in the home it also provided access to a fairly rudimentary set of support services that were largely delivered through kind of phone-based support and advice and when we did the consumer research this product which I think was retailing around 50, 60 pounds a month, the consumers actually placed a higher value on the service that was being offered than the cash benefits that were being paid out. And they actually felt that at least half of the premium that they were paying was funding the provision of services. In actual fact, those services were simply pence to provide every month compared to the actual insurance product. And if you look at insurance products that sell rather than ones that need to be sold. It tends to be things like roadside assistance, home emergency plans and insurance products that actually provide you not so much money, but support at your time of need. And so I think particularly with the younger ages, I think what they're looking for, there will be an aspect where they need financial support, but I think it's much more service driven. As we mentioned earlier, a greater focus on helping them to prevent things from going wrong rather than being there to catch them when things do go wrong. I think that is the more compelling space for us to focus on. Yeah, prevention, a big word, right? We are moving from protection to prevention. In a recent discussion with the Care Voice and Accra Global Healthcare, we talked about moving from paying the bills, the claims to becoming a care partner. And so all this concept of being in the life of the customer, the user, is critical, but also helping them understand how they can prevent things to happen so that they live healthy, fulfilling lives is very important. So I have a question going back to your past, actually, Alan. As a chartered insurer with the Diploma of Medical Underwriting, right? So you have a lot of expertise in the medical sphere and also how to underwrite price products. You sit at a rare intersection of clinical knowledge and commercial insurance expertise. How has that dual lens shaped the way you design healthcare products and services and propositions? Yeah, very good question. So I've always been fascinated by risk and it's what brought me into the insurance. I didn't realize it at the time, but it's what brought me into the insurance world. And within insurance, the way that you can help people manage their risks through things like an insurance pool and through spreading that risk amongst many other people like yourself. And that sits at the heart of what you do as an underwriter or an actuary pricing insurance products is thinking about how you can smooth out those lumps and bumps that people experience financially from claims or medical requirements over the years. But then as my career sort of developed, I found myself working with various kind of health tech organizations and so on. And as we mentioned previously, there's this growing appreciation of the fact that so much of what we do individually impacts our health and our mortality. And it made me realize that actually how we do business today doesn't really quite make sense. You know, so if you were if you were constructing insurance afresh, take life insurance as a simple example. This is a product where we let's say we sell you a product at the age of 30. We're going to underwrite you once we're going to take a snapshot of your health at the age of 30. And then we're going to insure you for the next 40 years. And we have literally no understanding around what's happening to your health. In the meantime we don even ask we we don check in to see how you are there nothing we can do about your health because we don know what state of health you are in And it just seems really well when you look at it like that it just feels really strange that you have a contract where the insurance company is on the hook for the risk of someone dying for the next 40 years. And when you reflect on the fact that so much of that health risk is actually directly within the control of the individual and yet there isn't any engagement between the two parties there's no mechanism in the product to enable you to reassess that risk part way through and so you have let's say you have two identical 30 year olds one could be leading the perfect lifestyle and one could be leading the exact opposite of of that and yet they would both get the same insurance premium if their health was similar at the start they're going to go on very different health journeys throughout that lifetime and the insurance company would never know. And the person who is listening to what their doctor says, who does take their health seriously, within that insurance pool is actually subsidizing the person who doesn't take their health seriously. And so there's a bit of a disconnect, I think, between what would be right for society, but also what would be right from a risk management point of view in how our products are structured. And to use some technical insurance speak when we talk about life insurance these are long-term products and this is a long-term insurance pool and what we mean by that is that you are underwritten once at the start of the policy and the insurer will take the risk of your of your health deteriorating over time and it was deliberately constructed as a long-term contract out of a sense of fairness so that as you become older and your health naturally deteriorates, the insurance company stands by you. Yeah, we all know our health is going to deteriorate. Absolutely. Even though we may actually leave up to 100 years, now it's going to deteriorate at some point. Well, no, exactly right. The inevitable is going to happen, isn't it? So unlike motor insurance, where it seems okay to have annually renewable motor insurance, and if you're a bad driver, you end up paying a bit more for your premiums but it seems perfectly adequate to renew your motor insurance every year but if you had life insurance and you're underwritten every year you're going to get to a point where the insurance company no longer wants to insure you because the risk is too high and clearly that defeats the whole object of insurance so out of a sense of fairness for the individual we created the long term insurance pool but a bit like universal healthcare systems like the nhs whilst that feels like the right thing to do and it's done out of fairness, it creates an inherent unfairness, which is the fact from a behavioural perspective, the person who does take their health seriously and the person who does listen to what their doctor tells them is cross-subsidising the person who doesn't. And as we see with the NHS in the UK or any other healthcare systems, who are the people who take most out of the healthcare system? It isn't the people who are working hardest to look after their health it's the others and so it's it's i think there's an alternative way of looking at at fairness and so for for me this drives a lot of what i do with the with the health techs around wanting to support people to manage their health but it also tells me that there's more we should be doing to our products as well to enable the pool to operate in in a slightly different way so we still want to be fair and stick by people as as they get older but i feel we need to build more responsiveness into the product that enables us to maybe dynamically price products so that we sort of rebalance that kind of risk and reward that the individual experiences around their health and turn that partnership between the insured and the insurer into a little bit more of a risk management partnership where they're going to work together to manage that individual's health risk, whereas at the moment things are a little bit disconnected. Alan, are you more comfortable working with health tech that are located in Europe or are you open to work with any health tech startups which are made potentially in Asia but also in the United States where the systems are very, very different? Yeah, so I think the things that we're talking about here apply everywhere. So very happy to speak about it in any region, country, market. You're absolutely right, though. The healthcare systems vary considerably. And so what you might do in the detail in the UK might be slightly different in the US and again in Asia. So you always need to sort of, I guess, recalibrate the conversation based on the local market. But all of these themes we're discussing are the same around the world. You do have to look at the context, definitely. So let's talk about something you feel strongly about. Protection providers are seeing very low engagement with their health propositions. minimal uptake and minimal impact on the underlying risk. Many are still relying on outdated, expensive nurse support lines that like personalization, digital capability, or triage. What has gone so wrong with the way health services are packaged inside insurance products? I know we already touched upon some of those things, but I would like to actually have a much broader view on you know why is that so wrong yeah so and by the way the the companies that provide those services have been doing a great job for years you know and the nurses and the doctors and the clinicians who who work within those organizations are fantastic people but the way their services are made available to people just isn't very efficient and so if you're a protection insurer for instance in the UK you likely have some kind of claims nurse hotline or what we would call an EAP, a sort of employer assistance program, which is there to provide support to policyholders at their time of need. Historically, these have all been phone hotlines, so they're very manual and they're very expensive to run because there's a person at the other end of the phone. But they're also, maybe in some instances, even now, it is a phone number on a web page or in a policy wording. So they're very underutilized because they're not very easy to access. Some people don't even realize that they're there. Some companies do have an app from which you can access these services, but many don't. So they're very, very underutilized, but they are very expensive when they are utilized. So if you look at a cost to serve, every time the phone rings, the insurance company might be paying £450 for the organisation they've chosen to provide that service. So interestingly, most insurers I speak to are both really unhappy with the utilisation rates that they see, as well as very concerned about the cost of the service. And what really keeps them awake at night is the thought of them getting their utilisation rates up to where they would want them to be, because they would just see spiraling costs. So it's holding back their complete proposition. So what's the solution? The solution is to work with some of these digital pathway providers and these health tech organizations who can ensure that you grow your utilization, you get much higher engagement rates because you can make your product more accessible. But when someone comes into your care pathway, some will find what they need in pure digital form. Others will find what they need in maybe a blended approach of digital support with some asynchronous connectivity with a team of people who can support them. And only those people who truly need to speak to that nurse or truly need to be connected to that clinician will do so. So you're creating a much more efficient process, which brings down the cost to serve, which makes it easier for the insurance company to make it more readily available to their customers. And so until you sort of remove that cost loop, it's almost impossible for insurers to embrace that. And why is it important to get the utilization rates up? Well, aside from supporting your policyholders better, it's only by you getting as many people as possible to be using your support services that you get into that space where you can start to create real health impacts. You know, If you've only got two policyholders a year phoning up your nurse hotline, it's not really going to help you prevent or mitigate claims. But if you can get a good proportion of your policyholders regularly using your service, getting support one day on maybe their mental health and then engaging on your health improvement programs. If you can build that, I guess, momentum of engagement up, you're in a much stronger position to actually prevent and mitigate claims as well as support the individuals to achieve greater health outcomes. So you won't believe, but I am starting to engage with a health tech startup located in New York, which has built a platform that is probably considered as the Bloomberg of health, of health care. I would say health care, full stop. So it's beyond insurance is health care. And as I was reviewing a few resources over the past few days, I realized there's a new regulation that is coming out of the U.S. around hospital. And I know we have talked around an ecosystem, including the health tech and the insurers and the insurers, but also the regulators. And the regulators have actually put new regulations around risk intelligence pricing compliance, which are being imposed on the hospital to actually create more transparency and making sure they have the right markdown and machine readable assets so that, I guess, people know what they are getting into when they are going into a hospital. First, have you heard about some of these transformation regulation impacting hospital and therefore how the ecosystem is changing in some ways? And the second part is, can you tell us when you start looking at the value chain of all the stakeholders we need to interact with, you know, how they play with one another? Because we talk about insurers, we talk about reinsurers, we talk about regulators, we talk about health. like how you know what is the role of each of those party when we actually start looking at the ecosystem they're sitting in yeah sure so regarding that particular regulation change i'm not particularly close to that so but i'll read up and you know it was people need to get ready three days ago they needed to literally the first of april 2026 so all those hospitals are running to actually be compliant at the minute which i think is kind of fascinating yeah exactly and it speaks to your it speaks then to your to your question really in that things should be much more joined up than they are now and if you think you know i set my business up because i saw this rough edge between insurance companies in the health techs in reality there are rough edges across the whole um ecosystem and um regulators aren't the easiest to work with and regulators will tell you that they have sandboxes and they want to engage with you on innovation My experience, at least from an insurance perspective, is that they're typically not that easy to work with. And I think if they genuinely want to see insurance companies innovate in the right way, I think they need to be a bit more accessible and a little bit more agile than they have been. But if you helicopter out, I'm a strong believer in the fact that the insurance industry and regulators and whoever's running the local health care system and governments should look at these problems way more holistically than they do today. And one of the real frustrations that I have is it's a slightly UK centric frustration, but you could translate it, I'm sure, across the world is there are a lot of pharmaceutical companies, bioscience companies who seek to influence government policy and the policy of health care systems. and I'm not saying they're wrong I think it's absolutely right that they do that yeah because they they're creating wonderful new drugs and they'll have a view on how societal health can be proven and obviously they're going to promote their own products but why shouldn't they what frustrates me is the fact that the insurance industry doesn't make the same effort to engage with government and with regulators and so on and if it's okay for a pharmaceutical company to lobby the health secretary. Why isn't it okay for the insurance companies to step forward and do the same? Because from my perspective, and I'm biased because I grew up in insurance, but when it comes to prevention and health risk management, insurance companies are way more aligned to healthcare leads than pharmaceutical companies. Pharmaceutical companies ultimately make their profits from treating sick people. So who is most interested in the very purest form of what prevention is, preventing that person who is currently overweight from becoming a diabetic? Is it the insurance company or is it the pharmaceutical company who makes money from treating diabetics? I'm not saying or producing GLP-1. And just to be clear, I'm not pointing a finger at the pharmaceutical companies it's a bad reflection i think on the insurance world that we're not also at that table presenting our view because if you you know if you speak to any of the reinsurers that are looking at things like metabolic health and the impact that has on mortality and the impact that has on healthcare systems they've got a very clear view of the sorts of changes you would need to see within health systems to fundamentally transform societal health you could even you could make the Health Service sustainable once more if you could prevent diabetes. I'm not saying it's easy to achieve, but I don't think you're going to achieve that through a policy that focuses on GLP-1s, but proper prevention that focuses on people understanding nutrition, people understanding the impact of exercise and so on. Not in an athletic way, but in a this is how you get to live a fantastic life and feel better and live longer, etc, etc. So I do believe things should be much more joined up than they are. And by the way, if the National Health Service or any other healthcare system was run with a bit of insurance knowledge in terms of analysing the health risks that are in there and thinking about how you invest today in propositions that will give you savings further down the line from improving societal health, I think there's an enormous amount the insurance industry could do to support things like the National Health Service. Yes, it's interesting the example you've used because actually, you know, using GLP-1, Manjaro as an example of one of those drugs, it's about finding the right balance. Because we have seen recently some of our colleagues actually completely disappearing on this Manjaro thing. And first I was astonished, but I think sometimes it can be too extreme where, you know, it can actually look at the limit a bit unhealthy. So first about health and wellness. And even though you don't like the word wellness, it's about, you know, good diet and actually applying the good principle whilst taking those drugs to, you know, improve our health. So another question that comes to mind, Alan, is you have pointed out that there is a massive missed opportunity at the point of diagnosis as well. A moment where insurers could actually drive better health outcome and build policyholders' resilience. What does a genuine intervention at that critical point, right, when people are putting a claim together? We have actually just mentioned some of the reasons why people may actually put the claims to a life insurer. You know, what do we do to actually create more personalized pathways so that they know why, you know, they are treated in the specific ways and actually understand the outcomes which are being brought about? Yeah, definitely. There's a couple of different perspectives on that. I mean, first of all, is prevention isn't just about preventing the condition from occurring. So we had a panel session recently at a conference and I was joined by AXA and Bupa and WTW. And we had a really passionate conversation around prevention. And we said at the start of that session, people don't think about it in this methodical way. But there's three main types of prevention, primary prevention, secondary prevention, tertiary. So primary prevention is all around preventing that condition or disease from ever occurring. secondary prevention is all around catching it early so that you can do something about it you can treat it and and hopefully resolve the problem entirely and then tertiary is all around managing an existing developed condition but even at that third stage you know if someone has type 2 diabetes for instance that's not the end of the road now medical science a few years ago may have told you that once once you're diagnosed with type 2 diabetic that uh diabetes that's a chronic progressive condition that needs to be treated yes with a little bit of lifestyle advice but mainly with mainly with drugs but you actually see now successfully proven many times over that with changes to people's diet focusing on you know low carb and people improving their metabolic health you can have someone who's been a type 2 diabetic for 25 years actually put that condition into into remission so diagnosis is not the end point and there's always something that you can do to support someone to improve their health from where they're at and companies like Swiss Re have been looking at metabolic health for a long time and its profound impact on life and critical illness claims but they've even started experimenting with with claimants on disability products so people have been out of work for a long period of time you typically find people have comorbidities they've got a pain condition they've got a bad back they've got all kinds of things going wrong but just supporting people to improve their health from a cardiometabolic perspective often enables someone to actually start that journey of returning to work maybe a claim that in the past the insurance company would have given up reviewing and would have just been expecting to pay that claim all the way through to retirement the other the other one i'd say and i'd like to call out a company called percy health who are a cancer virtual clinic. Now, they have an end-to-end cancer pathway, which supports with prevention and risk assessment, screening, early intervention. But at the point of diagnosis, when that cancer patient is then preparing for treatment, they make available to the patient a multidisciplinary team of cancer experts who support them throughout that journey. And it's quite clearly proven that if you're getting the right support, the right advice on your nutrition, general physical health your exercise regime as you're preparing for your cancer treatment and you're supported in the right way throughout your cancer treatment not only does it make the experience better for you but it often actually means that the underlying treatment itself is better and has better outcomes and of course you recover from that more quickly and then they can support the person if it's appropriate to to make a speedier return to work now of course that's not just wonderful for the individual it's also wonderful for the insurance company. So you also have done some work, right? And because you are actually working with this ecosystem, you have developed a health and wellness modifiable risk strategy. So it would be great to understand what this is, because I believe this enables insurers to realize economic value from helping people improve their health outcomes. Let's dive into that. Tell us what it is. how we drive value? There's two ways of answering this. First of all, within the realm of what we've discussed already, it's a case, I think, of making sure that you pick the right types of intervention and support that genuinely create tangible health outcomes, better health outcomes. And if that is the case, it should be possible to put a clear business case together to show how that saves money for the insurance company. So that's, I think, fairly straightforward. And there's an extension which we've covered that already. I touched earlier on the fact that for us to make our products more appealing to customers, we need to think about how we create a contract that provides resilience. And we don't focus so much on the point of claim, but we focus on how we support people to manage their health. And I also mentioned how we have this challenge that we have these long-term contracts where the pricing remains the same and we only assess the risk once. So for me, when I think about modifiable risks, I think about this challenge that we have that most of the risks that impact the risk that we take as insurers and that impacts people's health are modifiable, i.e. they are within the control of the individual. And for us to reset that relationship between the insured and the insurer, I believe the market needs to look at things like dynamic pricing. Now, I don't want to suddenly decline someone or increase their premiums because they've been diagnosed with cancer or had a heart attack. But I do think it is fair to track premiums up and down in line with someone's BMI and their blood pressure. And these clinical risk factors that are essentially, they're almost like the human telematics. So would you use a watch and use this type of device to actually track the BMI or how would you start capturing that data? So you could use wearable devices, you could check in with the individual once a year or every long term contract. So it could be every two years, five years or whatever. But just find a way of keeping track with the insured as to what's happening within their health. Of course, if insurers are actively engaging with their policyholders, it can just be an integral part of that ongoing health engagement process. But I think it's really important to create that kind of responsive engagement between the insured and the insurer. And unless you move pricing up and down in line with someone's changing health, it's very difficult to fully achieve that. it needs to be done in the right way so obviously you'd set a maximum premium you're only going to track risk factors that genuinely are within people's control but I believe that that is not only possible but when I've done consumer research I think it so not everyone in the population would buy a product that is dynamically priced but as an insurance company I would quite like to ensure the people who are happy to buy that type of policy and embrace that kind of closer working relationship with the insurance company. And that has very significant impacts on the risk pool. Because as we mentioned earlier, there's currently a huge blind spot for insurance companies in terms of the ongoing sort of health of their portfolio. They have no ability to step forward and offer support because they don't know that someone's health is deteriorating. But of course, each year, some of your policyholders lapse. And one of the main reasons why policyholders lapse is because they've just remortgaged and they found a cheaper price elsewhere. Well, who are the people who are most likely to find a cheaper price elsewhere? Is it the people whose health has deteriorated or is it the people whose health has improved? It's the people whose health has improved. So the impact for insurers, and they can't see this because they've got a big blind spot, is they are losing their healthier customers. And their portfolio is ever more skewed towards the unhealthy customers who aren't able to get a policy elsewhere. So there's some very, it's almost a podcast all on its own to focus in on the risk impacts. But there are some significant savings that an insurer would find from dynamically pricing. And I believe consumers aren't phased by as much as insurance companies feel. And I've even spoken to regulators and they're very comfortable with the concept as well. Because most insurance, consumers do see their prices fluctuate up and down from one year to the next. Also, we're already applying this in commercial, right? We've seen this applied by a company like Key, for example, and probably New Entrance. But dynamic pricing, augmented pricing is something which is becoming much more prevalent as well in the commercial and PNC market. Both of us are sitting on the advisory board of the Care Voice. the Embedded Health Orchestra. So what drew you to being one of the advisory board members? I mean, I know Sebastian, he connected with me on LinkedIn. And, you know, that's the way everything started. And then now it's probably like three to four years. So what is your story? Well, so interestingly, I first met Sebastian when I was working at Swiss Reapro about five years ago. and it struck me that they were a real breath of fresh air in the health space and in particular because so insurers for a while now have been have been trying to bring health services into their insurance propositions and there are a large number of providers who have a platform of health services but the entire platform of those health services are services that they themselves provide so they'll have their own mental health they'll have their own virtual gp their MSK support and everything else. And there's nothing particularly wrong with that. But if you look at it from an insurer's perspective, the insurer isn't necessarily looking for that exact suite of services. And they're going to have their own view as to what they want to bring into their proposition from a mental health perspective. They're going to have their own view as to what they consider to be best in class in terms of lifestyle nudges and prevention and so forth. And so if you're a provider who all you can do is offer a suite of your own services, albeit nicely pulled together on a platform, I think that's a bit restrictive. So what I really like about Carevoice is the fact that they are, I mean, they have their own services and partners that they work with, but they're completely agnostic as to what providers you plug into the platform. What they do is focus on orchestrating personalized journeys for policyholders. So what matters to them is that AXA customer or whoever goes on a relevant journey that takes account of their state of health and what their needs are and what their preferences are. Is it prevention or are they seeking care support in the moment? Whatever it is they're looking for, whatever it is they need, they have a journey that is orchestrated for them, personalized to them, quickly connecting them to whatever it is that they're seeking out. But the services that they engage with aren't services that Carevoice are offering, but they are best-in-class service providers that have been brought in from the, you know, best-in-class all around the world. So that flexibility I really, really like. And of course, if an organisation is just providing the platform and the orchestration, it means that they are focused very much on doing that extremely well. And they have things like engagement as a service which we've mentioned it a few times this afternoon insurers are not happy about their engagement levels and so to have a partner who can orchestrate a perfect set of services for you but then to support you in ensuring that you drive the right kind of engagement levels and have your customers actively using those services so that they get benefit from the services and you get benefit from the impact of those services from a risk ROI perspective. It's a winning combination. Yeah, I remember, I mean, I haven't checked the updated number around the partners. I remember there was around 70, you know, partners were on the platform. And when you start looking at the various insurers, healthcare insurers, you know, leveraging the platform for this orchestration capability. They can mix and match whatever is relevant for their ICP, their target markets. And that is very powerful. So here's my last question for you, Alan. You know, founders, insurers, reinsurers, regulators, healthcare innovators who are going to listen to this conversation will probably want some advice from you. So what would be one or two of the advice you would give those players trying to enter our industry and also to the insurers, reinsurers who are trying to find the right balance in driving the right engagement with their healthcare customers. Perfect. So I'd like to answer that question in two parts. So first of all, to the insurance companies. So the world that I come from is to be bold and be brave and don't fret about the regulators. Don't fret about where the consumers are at, but do what you know to be right. And there is a wonderful opportunity to step forward into the world and to support people to be more resilient to disease, as well as to cover them when something bad happens. That's good for you as a business because you'll pay fewer claims. It's brilliant for your customers. You'll get much higher new business volumes because you'll be selling something that's truly compelling and attractive, in particular to those difficult to serve younger lives. But you're not going to achieve that if you make superficial adjustments to your service proposition, if you're not prepared to look at things like dynamic pricing that fundamentally changes how the product would be perceived by the consumer. And if you hide behind your traditional distribution channels, there are a lot of very large insurance companies out there with lots of money. um sadly it's the distribution startups who are having to big borrow and steal money from venture capitalists who then want them to immediately grow which is really unfair you're leaving it to them to do all of the industry's hard work and i'd like to see some of the the big insurers properly embrace the opportunities that's my message to the to the insurers and then for all the the wonderful insure techs and health techs is i just urge them to not give up on our insurance industry. It's really difficult to work with. I do appreciate that. Maybe try and get some help from a friendly consultant who can guide you through that maze. I think a lot of health techs and insure techs, they're quite sales orientated. They're rightly proud of what they've built and they're very bullish. I think it sometimes helps to be a little more humble. But crucially, get someone in your team. you don't need a big brash sales guy. You need someone in your team who can help you understand insurance and who can help you speak insurance to insurers and who can interpret insurance language when you're listening to what they're saying they need. And if you build your proposition in the right way, there's lots of money for you to make and you can feel really good about the impact that's going to have on society. You just need to approach it in the right way. But do keep pressing because we will get there. Well, thank you, Alan. As we are finishing that conversation, I just want to do a shout out to a colleague, actually, with a podcast called Bold, Brave, Brilliant, Janet Linfoot, who used to be a while ago the CEO of Saga. So we have been on each other's podcast. But that are your final words, right? Be bold, be brave and be brilliant. So thank you for joining me today, Alan. Thank you very much. And that is a wrap on one of the most honest conversations I've had about health insurance from a market practitioner. It's what I'm taking away. The gap between the health insurance we have and the one we need isn't a technology problem. It is a courage problem. And hopefully my previous conversation with Xavier Lestrade from AXA Global Healthcare, AXA Health International, exemplified this. Insurers who win in wellness don't win because they buy the flashiest app. They win when they stop rewarding the already healthy and start designing for the policy holders who actually need them. That is where digital risk intelligence earns its keep. That is where the insurance intelligence layer stops being a slide and starts being a P&L line. Three quick things before we go. One, it subscribe on Scouting for Growth wherever you are listening. We have got more frontier firm operators lined up and you don't want to miss them. Two, if this episode sparked something. Leave a rating or a quick review shared with a colleague too. It genuinely helps us and other corporations, innovators, investors and founders find the show. Three, go find Alan Martin on LinkedIn and follow Resilience, Risk and Health Solutions. He's building the playbook while most of the industry is still writing the problem statement. I'm Sabine Vandolinden. Keep scouting, keep building. See you on the next episode.