I was reading an interesting article How Wearable Devices Are Disrupting the Insurance Industry. It does talk about a number of scenarios on how data collected by wearable can have an impact on how the insurance industry works and also the privacy concerns around this.
Insurance industry has been toying around with devices for some time now. I remember some auto insurance companies in US, providing devices that are placed in cars that can give you a discount if you are a safe driver. But this has not been widespread and still is in very small segment /experimental phase.
But now consumers already have devices that track most of their personal life. One thing that the new wearable like FitBit, Apple Watch, Microsoft Band etc. provide is access to health related data like heart beat and exercise routines. This can be a gold mine for health insurance companies as it gives them personalized data for each insured.
Again this opens up a can of privacy issues. Do you want your insurance company to have access to your heat beat, number of hours you sleep or exercise records?
I cannot predict the future, but if consumers agree to share data (lower premiums may push people to override privacy concerns??), this can turn the way health policies are underwritten upside down.
Obviously this requires adoption of a lot of new technologies like IOT, Big Data, machine learning etc, so that the insurance companies can make sense of the huge amounts of data that is going to be coming in and then take appropriate underwriting decisions.