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rohicks

Posting about skydiving to social media could affect insurance premiums

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Read this article in the Wall Street Journal this morning and thought it might be worth a discussion for our community to see what people think about this topic. Not sure if this belongs in this forum or the speaker's corner. Mods move if needed, please.

Original article - https://www.wsj.com/articles/can-a-facebook-post-make-your-insurance-cost-more-11552915222
Without the paywall - https://outline.com/sgtDcg

Quote

Can a Facebook Post Make Your Insurance Cost More?

Did you document your hair-raising rock-climbing trip on Instagram? Post happy-hour photos on Facebook ? Or chime in on Twitter about riding a motorcycle with no helmet? One day, such sharing could push up your life insurance premiums.

In January, New York became the first state to provide guidance for how life insurers may use algorithms to comb through social media posts—as well as data such as credit scores and home-ownership records—to size up an applicant’s risk. The guidance comes amid expectations that within years, social media may be among the data reviewed before issuing life insurance as well as policies for cars and property.

New York set a high bar, requiring insurers to prove that any social-media data used in underwriting is actuarially justified, logical for use and doesn’t unfairly discriminate against certain customers.

“We’re going through a period now where most life insurers are exploring using all types of data, not just data they get directly from the customer proactively, but other external sources of data—social media being a big one,” said Ari Libarikian, a senior partner at McKinsey & Co. in New York.

He anticipates that some day, underwriters will assess potential customers with automated reports based in part on their social media use. “It’s here to some degree and it’s coming in the next couple of years,” Mr. Libarikian said.

Below, insurance and data experts offer insight and advice:

If I post photos of potentially risky behavior, will my life insurance premiums go up?

The time and effort to monitor an applicant’s online presence can be costly, so few if any insurers are doing it yet in detail or at scale, says Jacques van Niekerk, chief executive of Wunderman Data, a unit of WPP Group . To spend resources figuring out that a policyholder went to Saint-Tropez and paraglided without a helmet for purposes of boosting a premium rate “could be bad and misguided,” he said.

What should I avoid posting on social media?

Given how digital histories can linger, people should go easy on photos of risky behavior such as smoking and instead play up boasts about healthy activities, like recent cycling trips or marathons, said Mike Vogt. He is executive director of data and analytics for SPR, a firm whose services include using artificial intelligence and social media accounts to help insurers process claims.

“Paragliding, ice-climbing, riding a motorcycle while drinking a beer: They are a little over the top, but honestly, I’ve been surprised at what people post,” he said. “That history never goes away, even if you remove the post a few hours later.”

Could my digital habits help my insurance costs go down?

Some life and car insurers are exploring whether consumers will share real-time health or driving data. Remember, a life insurer who took blood and urine samples already knows a lot about the customer. To develop friendly relationships, some insurers are offering perks like gift cards in exchange for reaching milestones in exercise and providing details about sleep. “If you live a healthy life, why not share that?” Mr. van Niekerk said.

However, such sharing isn’t for everyone and some privacy experts caution against trading personal data for perks.

In the future, social media data and other information sources could make life insurance cheaper and less of a hassle to secure. “What if you didn’t have to go to the doctor and give blood?” Mr. Libarikian said.

On the car insurance side, many people are using mobile apps that track their driving habits, such as how often they slam on the brakes. “Consumers are going to get more and more benefits offered to them—like reduced premiums or better risk advice,” Mr. Libarikian said, “if they share some of their data on social media or elsewhere.”

How are insurers using social-media data right now?

Some insurers are using social media in handling claims. Insurers can check explanations of auto claims against Facebook testimonials about an accident. And they could challenge disability claims if posted photos from a ski trip, for example, contradict an impairment or illness.

What is holding back the use of social media in underwriting?

The technology to study individuals’ social media accounts to make underwriting decisions is underdeveloped but likely inevitable, consultants and data scientists say. “We know that underwriting is the next big thing” to mine online postings, SPR’s Mr. Vogt said.

But until and unless the technology is perfected, it generally isn’t cost-efficient for insurers to assign staff to look at Facebook pages and tweets. Verifying identifications on social media, tracking oft-changing accounts and converting the information into usable, predictive data isn’t yet scalable or cost-effective, companies said.

Also, insurers aren’t yet confident that information from social media is better than traditional sources, such as answers to questions on applications, prescription-drug databases and blood and urine samples—though ultimately it could be easier and cheaper to get.

Do privacy settings help?

Yes, industry consultants say. Review the privacy settings on each social-media account, making sure posts are only shared among your selected network. Untag yourself from photos other people post, and ask friends not to tag you in the first place.

Ultimately, though, experts warn that if you lead an unhealthy life, your insurance company will figure it out the old-fashioned way, by asking questions and taking blood and urine samples.

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Edited by rohicks
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It's a non-issue. If you're worried, dont use your real name online and restrict the privacy settings. At the end of the day, the free market principle still applies. If my whatever insurance company raises my rates because I have a profile photo of me skydiving, fine I'll just drop them and find someone else. They can come up with any excuse they want, I am still the one that decides if I want to continue being their customer or not.

Edited by Westerly

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The issue is that you probably would not know why your rates were raised. Also, at some point we will reach a stage where every insurance company is doing the same thing, and then what?

A similar issue is the offer to lower your rates for car insurance if you agree to have a GPS logger permanently in your car so the company can see if you're a very cautious driver or if you regularly drive in areas where the risk of damage is low in comparison. In Germany, this is currently a voluntary agreement between the insurance company and the client to offer lower rates for lower risk, and of course clients would only agree to this if they think they can benefit. But given enough time and clients who do this, this could turn around in a few years and insurance companies might very well charge extra (even if it's a hidden raise) if you do not have one of those things in your car.

I'm very cautious as to what I share on socal media and otherwise, but just me being cautious might not be enough. I might need to go with the masses and start posting pictures about a healthy lifestyle. In a few years, not posting pictures of your veggy diet and yoga classes (or not even having a social media account) might make you stand out like posting pictures from your fun weekend skydiving today.

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I don't think it matters if you are a skydiver, just state that in the insurance application. Of course it will cost more, but you'll be covered if anything happens. I spent 6+ months trying to find insurance that made sense for me and our family that covered skydiving. At the end of the day, I got two policies - one for a fee of $2/1000 of coverage with a general aviation rider that covers skydiving and a policy without the rider. I post as many skydiving photos as I want on social media.

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14 hours ago, EnricoPalazzo said:

I'm very cautious as to what I share on socal media and otherwise, but just me being cautious might not be enough. I might need to go with the masses and start posting pictures about a healthy lifestyle. In a few years, not posting pictures of your veggy diet and yoga classes (or not even having a social media account) might make you stand out like posting pictures from your fun weekend skydiving today.

I dunno. It's funny how the zeitgeist swings from "public social media is dying, people have moved on to privacy focused apps like snapchat, stories on facebook and instagram or DM style encrypted apps" to "well the next generation will eventually be so used to public social media that they will be on there all the time"

I think the privacy trend is more likely, especially if people think posting publicly will affect them financially. There are always the exceptions that prove the rule though.

The whole "once you post it you can't take it down and it will be on the internet for anyone to find forever" is not that simple either. There are plenty of ways to share information that won't be seen by an insurance company, and even deleting a tweet on the ultimate public space, twitter, will let it slide out of view of prying eyes (unless you are a celebrity / public figure or have followers that will retweet you or report you).   

But if I was committing insurance fraud, like any other illegal act I sure as hell would keep that as private as possible. Posting about walking around while you are laid up recovering from your slip and fall would just be dumb.

 

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An insurer (in my state, Indiana, at least) cannot raise the rates or make any change to a life insurance policy once it is issued as long ask the information gathered when the policy was applied for was truthful. I bought an accident policy which I had my agent examine. There is no exclusion for skydiving. I understand this is no longer the case, so I'll keep this policy as long as I am jumping. (My regular policy excludes skydiving.)

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