Dynamic Insurance Benefit Adjustment via Wellness Monitoring
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Solution Overview
Problem
Conventional life insurance schemes lack motivation for insured individuals to maintain wellness, as they do not effectively incentivize preventive health measures, leading to increased risks of insured events such as disability or death.
Innovation Solution
A system and method that includes a benefit module to define insured events, a monitoring module to track compliance with a wellness program, and a calculation module to alter benefits based on participation, providing increased benefits for higher levels of engagement in wellness programs, thereby motivating insured individuals to prioritize their health.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If conventional life insurance schemes operate with fixed premiums and predetermined sum assured, then the insurance contract is simple and easy to understand, but the insured person lacks motivation to maintain wellness and manage health risks
Solution Approach 1:
The patent applies dynamics by making the benefit amount variable rather than fixed. The sum assured is dynamically adjusted based on the insured person's wellness program participation level, transforming the static insurance contract into a dynamic one that responds to health behavior changes. This resolves the contradiction by introducing motivation through variable benefits while maintaining the core simplicity of the insurance mechanism.
Solution Approach 2:
The patent changes the parameter of benefit amount based on wellness participation. By linking the sum assured to measurable wellness parameters (such as health assessments, lifestyle choices, or program completion), the system creates incentive-based parameter adjustments that motivate insured persons to maintain wellness without fundamentally restructuring the entire insurance scheme.
2Reliability
If the benefit amount is altered based on wellness program participation, then the insured person is motivated to maintain wellness, but the calculation and monitoring system becomes more complex
Solution Approach 1:
The patent introduces a wellness program as an intermediary between the insured person and the insurance benefit. This intermediary structure simplifies the overall system by creating a separate, manageable layer that handles wellness monitoring and participation tracking, while the insurance core remains relatively simple. The intermediary translates complex health behavior into measurable participation metrics that can be easily integrated into the insurance calculation.
3Productivity
If fixed premiums are paid regardless of health status, then the insurance scheme is simple to operate, but the insurer cannot incentivize preventive health measures
Solution Approach 1:
The patent applies preliminary action by adjusting benefits in advance based on anticipated or achieved wellness outcomes. Rather than reacting to health events after they occur, the system proactively adjusts benefits based on wellness program participation, encouraging preventive health measures before insured events happen. This resolves the contradiction by enabling incentive-based productivity improvement while keeping the benefit adjustment mechanism straightforward and rule-based.
Data Source
AI summary
A system for managing an insurance scheme, the system including a benefit module to define at least one insured event for an insured person and to define at least one benefit to be paid out on the occurrence of one of the insured events. A monitoring module monitors the compliance of the insured person with a wellness program. A calculation module alters the at least one benefit based on the degree of participation of the insured person with the wellness programme and an awards module, on the occurrence of the at least one insured event, provides the at least one altered benefit to the insured person.