Customer-centric InsurTech Innovations

Are InsurTechs profitable? What is the primary goal of an InsurTech? Why are InsurTechs important? These and other questions are addressed in this interview with Jane Wang, founder and CEO of Optimity, a health and wellness InsurTech.

What makes Optimity an InsurTech?

The most populous definition of InsurTech refers to “a set of platforms (or business models) that create an enhanced customer experience by applying innovative technologies to the insurance industry.” From another perspective, it is defined as “the use of technology innovations designed to squeeze out savings and efficiency from the current insurance industry model.”

Looking at either one of those definitions, we see that Optimity is an InsurTech platform. First, from a customer-facing perspective, our digital mobile-first platform engages members (policyholders or plan members) using behavioral science and gamification. We create rewarding experiences for members using data-driven personalized nudges and incentives. They complete micro-learning and micro-activities that lead to improved health, financial literacy and more interactions with the carrier. This all contributes to the enhanced customer experience and value.

Second, the actionable data and insights created by our engagement engine are then used by insurance companies (including teams from distribution, customer experience, marketing, underwriting and product) to streamline and modernize the product and services.

Bringing it all together, we have Optimity, an InsurTech platform that provides a mutually beneficial relationship between policyholders and insurance companies. We help insurance be more valuable to more members.

What types of problems are you trying to solve in the insurance industry?

Customer-centricity has become a strategic focus for the insurance industry. The modern consumer expects more from insurance companies. We help carriers engage with their customers to understand them better, deliver more value to members and enable new products designed to serve modern consumers. Our goal is to move the needle on net promoter scores (NPS)/trust/value metrics and close the protection gap for our clients.

We recently hosted a webinar with two insurance executives from Prudential and Sun Life about this very question. Here are the top three areas of opportunity in the insurance industry and how the Optimity platform can help:

1. Increasing engagement with current and prospective policyholders. As discussed in the previous question, the Optimity platform can be customized to the evolving needs of customers through the modular, software-as-a-service (SaaS) platform. By offering users incentives for daily healthy activities, insurance companies—through the Optimity platform—not only increase engagement but also ensure a healthier, more educated user base.
2. Speed to market for new products and services. The services some of the largest insurance companies offer are built on legacy systems, with disparate technologies bolted on through previous decades, making them extremely slow to adapt. By tapping into the Optimity platform, insurance companies can introduce new technologies to millions of users in a fraction of the time, and they can have those services seamlessly tied to their internal systems and technologies.
3. Improved (faster, more accurate and less costly) underwriting. The longitudinal data collected by Optimity can do for insurance companies what a credit score has done for financial institutions. By tapping into an individual’s thousands of health data points—their average steps taken per day, their meal choices, their smoking and drinking habits, and even their consumption of fruits and vegetables—underwriters are able to have an accurate “health score” and provide a product at a price that is suitable for that individual. In addition to retroactive insight, the data collected can provide future-looking insight as well. For example, underwriters can pre- (or conditionally) approve certain services for an individual as long as they can maintain a healthy lifestyle for a certain period of time, at which point they can either provide a discount, increase the premium or provide additional coverage based on the person’s lifestyle changes.

What was your inspiration to start a company in the wellness space?

My mother got sick and passed away from cancer at age 52—and I couldn’t do anything about it. She never gained access to the amazing science and technology I had been working on as a mortality specialist in proactive health tech and at pharmaceutical companies. This made me realize that access to consumer-facing technology was a critical missing piece of the longevity and mortality puzzle. It plays a crucial role in democratizing access to the right proactive health information, personalized prevention and early-detection support. It focused me on building a scalable technology solution that would codify the science of proactive health habits and conscientious behaviors, as well as the practical ways people can achieve vibrant, high-quality, long lives.

I was compelled to build programs and tools people like my mom could easily access. We now have scalable ways to educate, incentivize early intervention and put ourselves into a better position—both health-wise and wealth-wise. My mother inspired me to evangelize self-care for as many people as possible, creating small, easy steps for them to live longer, healthier and better.

How do you measure success?

Our company mission statement is to help the people we know and love become healthier, wealthier and live longer. So, to us, success is about improvements to members’ lives.

We understand that to get there is a long journey, so we break it down with milestones. Our aim is first to focus on members in our own “backyards” and be of service. We are providing the Optimity app for all North Americans to access today. The goal is to grow our footprint quickly and sign up more than 100 million people in North America—a big number and percentage of the population—and ultimately serve billions worldwide. We already have made a dent, having added more than 1 million members in just the last 18 months. We have been helping carriers launch in-force policyholder programs, employer wellness programs and external marketing programs for consumers, too.

Access is key. We believe the best-in-class InsurTech solutions like Optimity should be available beyond just the in-force policyholder population. When it is designed to be more inclusive for all, it attracts and supports a bigger, healthier community. This is a wonderful product that is changing and improving lives while also helping our carrier clients gain market share and close the protection gap.

We also see a quantifiable difference in health outcomes. For example, from the data and health metrics we collected, we have been part of nine different scientific studies and continue to supply and publish our data on how much the Optimity programs and apps are moving the needle on physical health outcomes and population engagement.

Additionally, we have received thousands of positive reviews in the app stores and hundreds of heartfelt testimonials from members who tell us how much our app has impacted their lives—from losing weight to training for a race to becoming more educated about finances. Oh, and let’s not forget about all of the great rewards and rewarding experiences they’ve earned through our programs.

What has been the most challenging aspect of building your business?

Lack of major funding commitments for female founders has been the biggest challenge. I had to get client traction early. While raising venture money, I’d get a lot more questions, and it takes a long time, so we had to demonstrate a lot more traction for every round of funding. It’s very hard to do more with less at every stage of the game. The good part is that it made my team and business very efficient, and my investors are truly 100 percent aligned with me on vision, mission and strategy.

What is your academic background? What skill sets are needed to run an InsurTech? What types of talent are you looking for?

In short, I was a mortality specialist. My formal education and background were in health sciences and data. I received my B.S. in biochemistry from McGill University and my MBA from Ivey Business School at Western University. I also completed my executive training at Stanford University.

Prior to starting my journey as a tech entrepreneur, I spent a decade leading teams in global clinical trials for pharmaceutical companies, developing technologies and programs to maximize patient outcomes and longevity.

Regardless of the type of role, we need teammates who are triple-A players, meaning they:

1. Are actively engaged in and love what they do for work
2. Are aligned to our mission and strategy at Optimity
3. Have the ability to execute in a collaborative, effective and compelling way

Have you worked with actuaries, and what’s your impression of the role of actuaries in InsurTech?

Actuaries are part of our board, management and execution teams. They are a key part of our roadmap and decision-making framework. They are some of my favorite people! These innovative actuaries understand the value of data and are defining their new role and adapting to needs in the insurance industry. Our app is extremely user-centric, and this frequent engagement model allows us to collect a lot of data and insights, which ultimately empower the actuarial teams and key use cases to assess risk, recommend the right products and determine the right price for each member. With tens of millions of North Americans either underinsured or not insured, we look to actuaries to use the data we provide to design affordable and timely insurance products to make insurance relevant and accessible to the majority of the population.

What has been the most valuable lesson that you have learned?

Trusting in my (and my team’s) abilities, our mission and embracing discomfort. First, I’m sure anyone who is transitioning from the comfort of a traditional 9-to-5 job to take on the uncertainty of launching a tech startup would relate: I knew the gravity of the issues that I would be addressing. The challenges were fundamental. Insurance moves slowly; I was building a new category and pushing the envelope almost daily. The more I started to see positive outcomes—how we can help members achieve their health, financial, physical and mental wellness goals—the more I trusted in myself and the mission.

When there were tough times, my amazing team would also embrace the discomfort, revisit the mission and rally together to drive to the next big breakthrough. They too have a lot of trust in me and one another. Their grit and creativity inspire me every day and allow us to solve many tough problems.

Has COVID-19 affected you, your outlook or your business?

Yes! In mid-2021 (at the peak of the pandemic), we completed a comprehensive survey—with more than 138,000 respondents—and asked questions about how the pandemic had impacted their physical, mental, social and financial wellness. The bad news was that the pandemic had impacted every aspect of an individual’s life, from their social connectedness and their daily healthy habits to stress and financial worry stemming from a lack of preparedness (e.g., having proper saving habits in place).

The report also showed that the areas where people felt the most vulnerable were all areas an app like Optimity was designed to address and provide support. We call them the five pillars of health, namely: physical, mental, social, financial and nutritional.

A global event like COVID-19 demonstrated how providing individuals with guided, daily activities can help them prepare for—and persevere through—life’s challenges, and help them achieve their goals, whether they be health- or financial-related.

Do you have any advice to share with actuaries who are aspiring to become entrepreneurs?

Understand and be aware of the risks and challenges you will face and the limitless rewards and passion.

My other piece of advice is to look at the insurance vertical and “think bigger!” To solve the world’s leading problems regarding insurance, removing the two big “f words”—fear and friction—is key. Think big. Take what you are passionate about from your current role and lean into creating big, scalable and accessible versions using your problem-solving skills.

In addition to hearing the advice, actuaries who are aspiring to become entrepreneurs should also ask themselves the following: Do you truly feel compelled by what you are doing, through thick and thin? Are the people you are surrounded by compelled by the same thing, and will they be with you through thick and thin? Will you truly enjoy the journey as well as the destination?

Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries or the respective authors’ employers.

Copyright © 2022 by the Society of Actuaries, Chicago, Illinois.