The last five years have seen some incredible advances relating to cancer, primarily in the fields of cancer diagnostics (e.g. liquid biopsy), cancer treatment (e.g. immunotherapy) and cancer classification (e.g. via genomics), as well as in preventative measures.
In this, the first of a 4-part series of insurance-focused articles on cancer, Dr. Achim Regenauer, Chief Medical Officer, focuses on how these advances translate into high-level trends, and why they are so important to Life & Health insurance – all in a concise bulleted format, so there’s no need to wade through complex medical descriptions or interpret sensationalized headlines.
Alongside Dr. Regenauer’s observations, Bryce Shepherd, Head of Capabilities Development, Life & Health APAC, adds valuable market insights and solutions relating to how the industry can adapt to stay relevant, valued and sustainable over the next decade.
Parts 2, 3 and 4 of this article series will respectively address the main advances in cancer diagnostics, treatment and classification – each with corresponding market insights from PartnerRe’s Life & Health experts.
Ever-changing cancer trends mean an ever-changing cancer risk landscape. To stay relevant to consumers, sustainable and valued over time, Life & Health products need to change too.
With early detection and new treatments becoming prime influencers of cancer trends, we can intelligently design products with the future in mind by using product risk mitigants. Examples of these are waiting periods or moratoriums, tiered benefits (both static i.e. from outset, and dynamic i.e. changing over the policy lifetime) and severity/impact-based cover wordings.
A practical example is PartnerRe’s innovative treatment-based Critical Illness product– this product mitigates trend risk by reimbursing severe conditions up to a specified cap (e.g. cancer treatment including targeted therapy and even hospice care) and paying daily fixed benefits for minor conditions.
Such approaches realign the benefits to the new financial and emotional impact of a cancer diagnosis and ensure that the product is affordable to a wider market.
A reinsurer – providing expertise in products, pricing and specialised underwriting – can be a key partner for this.
Alongside product risk mitigants, proposition enhancements can be used to control rising and/or uncertain trends. We recommend focusing on partnerships to provide preventative, screening and pre-diagnosis services. Firstly, these helpful services can provide a ‘value feedback loop’ with customers and rectify the perception that insurers are only there for claims. Secondly, they can control long-term costs by catching illness early and enabling early intervention, helping to turnaround severity trends.
Another promising focal area, still relatively in its infancy, is the inclusion of incentive mechanisms to encourage positive lifestyle behaviours, e.g. to stop smoking, vaccination awareness and the promotion of healthy lifestyles. It is perhaps provocative to say ‘infancy’, as these mechanisms are included in many propositions, but whether their impact is material and consistent remains uncertain. It is not contentious, however, to say that digital health incentives provide an enormous (and expanding, as research uncovers more cancer risk factors) potential, should the mechanism produce the desired effect.
As a supporting and partnership-driven reinsurer, PartnerRe is here to work with, understand, quantify and make changes within the pricing and underwriting context to reward these endeavours. We note the expanding repertoire of correlated lifestyle risk factors and are ready to discuss bringing these into the risk assessment and pricing of cancer products.
Although cancer trends are increasing in some countries and socio-demographics, patient/policyholder expectations of life expectancy have dramatically improved due to advanced medical treatments and health management through positive lifestyle, diet and stress management measures.
Insurers can add value by complementing Life & Health products with health management frameworks that improve access to these positive developments, helping to counteract creeping adverse trends.
Policyholders/patients are then accompanied and taken care of by their insurer, magnifying the value of the relationship. At the same time, if structured correctly for sustainability, such frameworks can reduce overall costs for the insurer by shifting late stage, large lump sum payments to earlier, smaller claims.
Asia’s middle-class is growing fast3; indeed, close to 90% of the next billion entrants to the middle class are expected to be from Asia4, and by 2030, two thirds of the world’s middle-class households are expected to be living in Asia5. There are clear market forces driving up demand in Asia for insurance against the second main cause of death, cancer. Insurers will correspondingly need to manage their increasing exposures to cancer risk (incidence and trend).
This growing demand for cancer insurance products necessitates a deeper understanding and monitoring of the trends: specifically of the evolving exposure due to medical advances, regional epidemiological trends, healthcare infrastructure, screening programs and lifestyle factors.
A reinsurance partner that can provide not just capacity for long-term cancer risk, but also insights into the effective management of this risk, will enable growth and add stability. PartnerRe can provide both to insurers in Asia.
It’s concerning that a delay of only four weeks can increase mortality by over 6%. Under current pandemic conditions, the market could look to complement base protection products with add-ons and/or services to make cancer screening and testing more accessible. Service examples include tele-consultation or video consultation services, self-testing kits and image-based AI to predict skin cancer.
If a pandemic were to happen again, or customers behaviours change irreversibly to prefer digitally accessible services, such as those offered via mobile phones, then building a proposition that attaches services bringing diagnostic testing and medical services to the policyholder, will be highly valuable. There is an opportunity for the insurance industry to step up and provide the financial structure or partnerships to allow these services to be offered, under the premise that cancer screening and testing today can reduce later stage large lump sums.
Making screening & testing more accessible is therefore good for now and good for the future.
We hope you found this overview helpful. Don’t miss the next article in this series, “Part 2: Cancer Diagnostics – Earlier Detection & Impact on Incidence & Mortality” – includes insights such as the imminent screening for cancer via a simple blood test – coming out soon.
Our approach is one of partnership, shared expertise and the creation of success for our clients.
We look forward to discussing these trends and concepts with you, and to turning them into concrete solutions for your business.
Bryce Shepherd, Head of Capabilities Development, Life & Health, APAC