It is easier to quantify our lives than ever before. Apps that measure everything from how many steps we take a day, to how many calories we eat, to how much work we do, and more, can provide us with complex data that helps us make adjustments to improve our performance. Companies can collect, analyze and use this data as well.
How Companies Use Data
Health and life insurance companies rely on statistics that predict which customers are likely to be more costly to them than others. Traditionally, these companies have gathered data about customers ages, weight and health in order to make these determinations. Today, there is sometimes a convergence between health, fitness and insurance apps. Companies may give customers a discount for access to the data these apps can provide. These are sometimes called interactive policies. They might offer customers lower premium prices if they take a certain number of steps daily or meet certain fitness goals. While some people find this intrusive, others find it an additional helpful motivator in staying focused.
Overall Health Helps all Parties Involved
Data sharing is not the only place where these types of apps overlap. In some cases, insurance apps themselves may offer online classes or help users connect to medical professionals who can answer their health-related questions. Apps might offer additional incentives for taking such actions as getting a flu shot or maintaining dental hygiene. Both health and life insurance companies are concerned with the health of their customers. While the assumption with the latter is that eventually the company will need to pay out, the aim is to ensure enough healthy individuals that people pay premiums for many years before this is necessary.
Lower Costs to the Consumer
It may be difficult for some younger people to think about this or any other element of estate planning because it seems to deal with something that is so far in the future. However, the advantage of purchasing it at a young age is that for some types of plans, it is possible to lock in a low rate for decades. Furthermore, even for young people with no dependents, this security can be important. It can help pay for a person’s funeral expenses and other costs associated with death as well as cover years of income if a person has dependents.
Life insurance can be a good investment and a money saver for a person’s family in the long run, but it is important to ensure that the premiums paid into a policy do not exceed federal limits that change it into a MEC insurance policy. In fact, a modified endowment contract is no longer considered a life insurance policy by the federal government, and as a result, withdrawals from it will be taxed differently from a policy. One reason for these restrictions is to keep a MEC from being used as a tax shelter. This is a complex issue, and individuals who are concerned about this limit and who plan to take money out against a policy may want to contact a financial professional to determine the best course of action.
