Google, Amazon, and Apple have all taken moves into the U.S. healthcare industry in recent months with a variety of tech-driven initiatives, and partnering with these new market entrants could provide re/insurers with new inroads into the market, according to GlobalData.
Danielle Cripps, Life & Pensions Analyst at GlobalData, said; “the insurance industry has been nervously tracking the activities of potential alternative providers.
“It was uncertain which area of insurance would witness their entry or when it would occur, but over the last few months it has become increasingly clear that the tech giants are targeting the US healthcare market.”
2018 has seen tech giants launch into the healthcare industry with new products and partnerships; in January, Amazon announced a collaboration with Berkshire Hathaway and JPMorgan to create a healthcare company to serve its U.S. employees.
Apple updated its health app, enabling U.S. customers to see their medical records such as allergies, conditions, immunizations, lab results, medications, procedures and vitals on their phones.
In Spring 2018, Apple is also expected to launch a network of ‘AC Wellness’ medical clinics for its employees and their families, while Google’s sister company Verily has reportedly been in talks with insurers bidding for health insurance contracts, explained GlobalData.
Cripps commented that “the race into US healthcare among alternative providers has truly begun, but each has a different approach.
“Amazon has opted to tackle the healthcare market using its power as a large US employer to drive market change, such as lowering healthcare costs and improving services for employees.
“On the other hand, Apple seems to be concentrating on creating a more connected service between customers and healthcare providers. It is positioning itself as a potential partner for healthcare providers and healthcare insurers. Meanwhile Google, which is still feeling out the market, is looking for partnerships. It may likely see itself in the role of an insurance distributor.”
Although some in the industry could see these inroads into the health industry by the tech-giants as a threat to the existing status quo, choosing to partner with these initiatives could bring new opportunities.
Cripps concluded; “alternative providers are highly influential brands, have masses of consumer data and resources, and are known for providing exceptional customer experiences. While they are seen as a threat, partnering with these providers could also be a key opportunity for insurance industry players.”
However re/insurers choose to respond, the playing field in the health insurance industry is changing and market incumbents will likely increasingly be faced with the prospect of cross-sector competition looking to take advantage of the digitisation of industries and consumer habits.