Hugh Terry presented on the future of healthcare insurance in a digital world. He outlined 3 key messages: 1) Thinking long term is strategically important, 2) Convergence of health and technology will drive major advances in healthcare, and 3) The future is bright for health insurers but business as usual will not be competitive. By 2035, technology is expected to have solved issues like healthcare labor shortages through innovations like home testing, virtual consultations, and AI assistance. The empowered consumer will directly access most health advice through mobile devices. Longevity will continue increasing demand, but costs must be controlled to ensure universal access. Health insurers will focus on risk prevention and operational excellence through distributed ledgers, AI, and

1. Hugh Terry, The Digital Insurer
Swiss Re ARMS Conference , 14-16 June 2017 ,Fukuoka, Japan
THE FUTURE OF HEALTHCARE INSURANCE IN A DIGITAL
WORLD

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This time in history is different (really)
“ Cars are our feet
Calculators are our minds
Google is our memory.
Our lives NOW are only partly biological
with no clear split between the organic and
technological, the carbon and the silicon.
We may not know yet where we are going
But we’ve already left where we have been.
”
Closing remarks by DT Max in National Geographic feature, “The Next Human – taking
evolution into our own hands” April 2017

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Caveat emptor – beware of experts

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What does The Digital Insurer do?
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We are fully vested into all things digital
insurance:
• Media & thought leadership
• Webinars and conferences
• Information services
• Advisory partnerships
• Actively building new digital businesses
Our aim is to help understand , find,
communicate and execute digital
strategies in insurance
More than 17,000email subscribers

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The Digital Insurer leadership team
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North America
•Hugh is the founder of The
Digital Insurer and is
passionate about the use
of digital thinking and
technology to transform
the insurance industry
Hugh Terry
•Les is responsible for TDI in
Europe. He is able to draw
on over 30 years'
experience in the
insurance industry with
leading insurers and
brokers as both a senior
executive and consultant.
Les Wong
•Andrew is responsible for
TDI in Africa. He is
convinced that digitally
based business models are
a prerequisite to making
insurance benefits
accessible to all
Andrew de Kock
•Rick is a thought leader
within the global InsurTech
startup community. Rick
contributes regular articles
on InsurTech and is
chairman of the Digital
Insurer
Rick Huckstep
•Andrew is responsible for
TDI in AUS and NZ. He is
our resident global
telematics expert and is
always at the forefront of
technological innovation
Andrew Dart
•As COO Malini is
responsible for content
delivery and key client
relationships for TDI. She is
fascinated by the potential
of technology to transform
& disrupt insurance.
Malini Thakerar
•Tom is responsible for
developing TDI in North
America. He has a wealth
of consulting experience
and is also the editor of the
Digital Insurance Library
section.
Tom Bobrowski
•As Publisher, Martin is
responsible for TDI
content. Martin is an
award winning journalist
with wide experience in
professional events
including roundtables,
forums and conferences.
MARTIN
KORNACKI
Europe AfricaGlobal / Asia
Australasia Global/ Europe
Global
Global/ Asia

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Presentation: 3 Key messages
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1. Thinking long term is a good
strategic discipline
2. It is clear that the convergence of
health and tech is and will lead to
further huge advances in
healthcare
3. The future for health insurers is
bright BUT…

7. Discussion agenda
1 When in the future?
2 The Future of healthcare
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The Future of healthcare insurance
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So What do we do NOW?
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8. When -2035(ish)
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Why 2035? A chance to look ahead
– but not without constraints
What’s coming up
“Now”
Blue(ish) Sky
V’s
Blue sky
V’s

10. Future of healthcare – technology will lead
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Future forecasting starting point – Optimist or Pessimist?
Attitude – has a huge impact on the forecast

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How is global poverty progressing?
Source : Hans Rosling (2013) – Highlights from Ignorance survey in the UK published at Gapminder.org
UK Survey in 2013

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The Facts

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Forecasting the future as an optimist
Because…
• Data suggests humans are doing pretty well
• Optimists are generally the change agents
• Optimists live longer and healthy lives!

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Problem or Opportunity ?

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Problem or Opportunity – healthcare costs out of control
More labour
More capital (tech)

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Technology will have solved this problem by 2035
Technology is the optimists solution to forecast labour shortages in healthcare
Opportunity
• Home testing
• Virtual consultations
• Uberisation of care in the home
• Increased medical specialisation
• AI in healthcare

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Examples of overcoming shortages of healthcare workers
Sunday Times UK , April 2017
Times UK , April 2017
DxTER, PSFK, April 2017
Healthcare
Is returning to the home
v
Hospitals a robo-human partnership
Star Wars ….

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An enormous wave of innovation
The finance and will is there

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Problem or Opportunity?

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The empowered consumer is the agent of change
Prediction: by 2035 more health advice will be directly through the mobile than from
face –to-face interaction with healthcare professionals
Opportunity
• AI enabled advice
• Wellness programs
• More opportunities to
influence customer
behaviour
• Rebalancing the healthcare
eco-system

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Example of the technologically empowered consumer
Prediction : AI will be part of the majority of current patient doctor consultations by
2035 . Likely both patients and doctors will use it

23. Digital Adoption – well underway now
23Source: CB Insights

24. Patient power – not a theory
24Source: CB Insights
Prediction: by 2035 use of health apps will be almost universal

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Increasing longevity will continue to drive demand
Prediction: by 2035 we will be confident that life expectancy can continue to advance at
at least the same pace in the last few decades. There maybe glimmers of proof that
maximum human life can be extended significantly beyond 120 years

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Modern “lifestyle” and “longevity” related disease
Will grow both absolutely and relatively
Diabetes
Source: team-consulting/2030
Prediction: by 2035 healthcare resources will be split more evenly between end of life
intervention and ongoing prevention and monitoring

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The optimists view for 2035: research will bear fruit
Obesity
Ferocious rate of change: “health care has changed as much over the last 150 years, as it will
over the next 25 years to 2035.“ Richard Worzel, Futurist, 2010
Telegraph UK, 2015
Type 1 Diabetes
Wall Street Pit, May 2017
Alzheimer’s
Sunday Express, May 2017
CNBC, Jan 2017
Cancer

28. Exponential medical knowledge curve
28Source: CB Insights
… But regulations have not changed significantly

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The cost of collecting data is falling ..
And new therapies emerge
Prediction: by 2035 anyone who wants their DNA to be sequenced will be able to do so.
Most will choose to do so … because of the then proven preventative health benefits
Trending to cents?
How far will CRISPR go?

30. Predictive healthcare analytics in 2035
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Prediction: proven value of analytics will drive IoT adoption by consumers.
Simple message to patients “No data = worse health outcome”
• Real time alerts on key vitals
• Risk analysis on admission
• Second opinion assistance routine
in all areas
• Vital sign monitoring during
admissions
• Precise & personalised medicine
• Risk assessed for readmission
• Routine use in drug discovery

31. Genetic knowledge advances medical science
31Source: CB Insights

32. What would happen with a global database?
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Would you want to know? Would you opt-in or opt-out? How will government policies
evolve?
MIT Technology Review , March 2015

33. Future of Health Insurance
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Demand for individual health care in 2035 will be very strong
• Burgeoning middle class with
disposable income to spend on
healthcare
• More options to have better
health
• Reluctance from employers to
pay
• Governments likely to focus on
basic provision

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Caveat : The role of Government will be critical in
determining healthcare insurance systems
• What is the government funded pillar?
• What rules will apply for underwriting of company provided
benefits?
• What transferability option and protection to consumers will be
provided?
• What regulations will evolve to deal with privacy and control
costs?
Prediction: Governments will continue to look to the private sector for solutions. But
politics will force the need for cost containment to allow more universal access to
modern healthcare

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healthcare insurers will prevent risks as well as finance healthcare costs – this will be
routine “BAU”
Product design: value added risk prevention
Source: KPMG
Health services
will
increasingly
focus on risk
prevention

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Product design for individual products - examples
• Provide strong incentives for self monitoring and submission of data e.g. elimination
or reduction of co-pays
• Provide incentives for treatment at home. Larger co-pays for routine human lead
consultations
• Steep discounts for robo-surgeons. Some product benefit limits designed to only
provide for robo-surgeons
• Chronic disease management an incentivised partnership not an entitlement
• Focus on Value added services for both customer engagement and profit
• Wellness programmes
• IoT integration
• Access to healthcare services (discounts for out-of-pocket expenses)

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The virtualisation of healthcare management in 2035
Prediction: all providers will be connected and claims will be seamless (really )
• Single source of truth
available on a real-time basis
• Fraud , waste & abuse
minimised
• Number of networks
consolidated – all will inter-
operate
• Global standard for sharing
data will emerge
Cloud based
networks are
routine

39. Consumer centric & open
platforms will be common
MEMBER
(employee / patient / individual)
• Service Provider
Search
• Personal products and
health records
• Prescription orders
• Medical test
management
• Tele-Medicine
• Online outpatient claims
• Wellness programs &
disease management
• Company provided
benefits
• Voluntary health insurance
• SAAS employee
benefits
• Configurable
Gateway - Health gateway enables many to participate & benefit whilst ensuring integrity of data
management
INSURERS
&
BROKERS
TPA’S HOSPITALS
& CLINICS
DOCTORS LABS PHARMACIES IoT &
WELLNESS
• Web Services API layer
• Eco-system integration
• Distributor co-branding
• Enable distributors to build
own customer propositions
& integrate health tech
Participants (clients & partners)
Open Gateway
Concept
Mobile Admin
39Source: HaelthTech

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Healthcare insurers in 2035 will be operationally excellent
Distributed ledgers will be
routine
Smart rules + AI will eliminate
>75% of FWA
Virtual avatars will be
commonplace. AI to human
interfaces will need to be
seamless
Customer service will be
truly multi-channel
Underwriting and pricing will be
fast, automated ,comprehensive
& ….regulated
Prediction: all of these innovations will be routine by 2035

41. So what do we need to do NOW?
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Presentation: 3 Key messages
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1. Thinking long term is a good strategic
discipline
2. It is clear that the convergence of health
and tech is and will lead to further huge
advances in healthcare
3. The future for health insurers is bright
BUT…
Business as usual will guarantee non
competitiveness

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So… Getting ready for the future NOW
1. Get MUCH closer to the end consumer
2. Get MUCH closer to the data
3. Invest in operational excellence
4. Lobby governments on measures to control healthcare
costs & enable management of healthcare data
5. Partner well - become embedded in the healthcare
platforms
Be prepared for industry consolidation – from within and outside of the industry

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Examples of NOW in Asia (not exhaustive)
Good Doctor - Mobile
access to healthcare
Wellness digital broker
& market place
EB and health insurance
administration platform
Practitioner admin
going mobile
Customer connectivity
+ Great Data
Partners, competitors or “co-opetition”?

45. Additional Slides
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5

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For further reading….
1. Forbes on on demand health care video: https://www.forbes.com/video/5238081865001/
2. National Geographic, The Next Human : http://press.nationalgeographic.com/2017/03/02/national-geographic-
magazine-april-2017/
3. EY six trends disrupting health insurance : http://www.ey.com/gl/en/industries/health/ey-health-reimagined-health-
insurer-of-the-future
4. Optimism & pessimism : https://ourworldindata.org/optimism-pessimism/
5. Economist : how hospitals could be rebuilt - http://www.economist.com/news/international/21720278-technology-
could-revolutionise-way-they-work-how-hospitals-could-be-rebuilt-better
6. Healthcare in 2035 , Richard Worzel : http://www.futuresearch.com/futureblog/2010/03/05/health-care-to-the-year-
2035/

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>70 million registered users
>1,000 full time doctors
Access to 50,000 contracted doctors
and 5,000 specialists
7/24/365 access including video
consultant
Find a Doctor
• May 2016 : US$500 million series A funding
• Goal of creating largest “closed” healthcare eco-system = “
Internet healthcare 2.0”
D
P
C
Product ecosystem model:
Good Doctor (Ping An)

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48Source: Ping An Health, http://www.pingan.com/app_upload/images/info/upload/5789191e-3019-4370-b8e1-a3a81561d4e3.pdf
Ping An Good Doctor:
Establishing an Online to Offline healthcare model

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Ping An Good Doctor: Online Consultation
Source: Ping An Health

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50Source: Ping An Health
Ping An Good Doctor: With scale

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51Source: Ping An Health
Ping An Good Doctor :
Community & Incentives to create engagement

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52Source: Ping An health