As we navigate an era of rapid digital transformation, the healthcare sector is at the heart of this evolution. Changes in societal needs, technology advances, and the ripple effects of the COVID-19 pandemic have triggered an explosion of digital healthcare solutions. Amidst these changes, commercial insurance agents face an urgent call to action. To stay relevant and effective in this landscape, they need to deepen their understanding of the digital healthcare environment, the insurance requirements for this fast-growing sector and the suitability of products that carriers currently offer.
The Catalysts for Healthcare Digitization
The digitization of healthcare has been accelerated by a series of interrelated factors. The societal impact of the COVID-19 lockdowns was a catalyst to this already moving trend, with technological advancements making it possible to transform the way healthcare services are delivered and received. Staffing shortages and early retirement trends among nursing professionals, brought about by the COVID-19 restrictions have heightened the demand for digital solutions, opening doors for new opportunities and challenges.
The growth trajectory of digital healthcare is astonishing, estimated to be worth $65.2 billion this year, predicted to grow to $253.6 billion by 2033. Sectors like telemedicine, which is reliant on widely available technology, have become significant contributors to this growth.
Emerging Digital Healthcare Modalities
- Artificial Intelligence (AI): AI is being used more effectively in triaging patient conditions, diagnosing basic illnesses via chatbots, and streamlining other healthcare processes.
- Augmented Reality (AR) and Virtual Reality (VR): These technologies are transforming surgery, medical training, mental health therapy, patient consent procedures, and patient engagement.
- Mobile Health (mHealth): With the ubiquity of mobile devices, mHealth is gaining prominence. It involves the practice of medicine supported by mobile phones, tablets, and personal digital assistants.
- Online Fitness and Lifestyle Platforms: These platforms offer fitness and lifestyle support through websites and mobile apps, allowing individuals to take control of their health.
- Remote Patient Monitoring (RPM): RPM uses devices and software to monitor patients outside conventional clinical settings, providing early intervention benefits.
- Software as a Medical Device (SaMD): SaMDs are standalone software applications that perform medical functions independently of a physical medical device.
- Telemedicine and Telehealth: Telemedicine and telehealth utilize audio and visual consults to deliver care at a distance, making healthcare accessible for remote patients.
The Lag in Insurance Adaptation
Despite the digital healthcare revolution, many insurance carriers are struggling to adapt. Their products have remained relevant to traditional health care with gaps in coverage for organizations that are utilizing digital technology.
The move to telehealth and the incorporation of AI in diagnostics has introduced new risks that could slip through the cracks with traditional coverage. An example is the misdiagnosis of a cancerous mole by a skincare app, which uses AI to determine if skin lesions are cancerous. The app analyzes images taken with a smartphone camera, to reduce the need for unnecessary in-person appointments. However in one instance the app made an incorrect diagnosis through focusing on the wrong part of the skin. This delayed the diagnosis and treatment for six months and put the patient at risk of bodily injury.
In this instance, traditional professional liability and cyber liability policies would not have protected the organization.
Andrew Dallamore of leading telehealth insurer, CFC, said in a recent interview, “”Most people now are purchasing either a traditional PL/GL policy in which the Tech and Cyber considerations aren’t adequately catered for, or they’re purchasing a conventional Tech and Cyber policy which has limited or no bodily injury coverage.”
Sadly many insurance agents are not even covering their clients for cyber liability at the moment. A 2020 survey by the Council of Insurance Agents & Brokers (CIAB) found that only 38% of respondents had purchased some form of cyber insurance. This situation leaves a large proportion of businesses unprotected against potential cyber risks while causing agents to miss out on substantial revenue opportunities.
Many organizations still underestimate the probability of a cyber breach, often considering it an issue exclusive to large corporations or tech-intensive industries. Commercial agents must proactively play a role in dispelling this misconception and highlighting the ubiquitous nature of cyber risks.
The Early Adapting Insurers
In this complex landscape, insurance carriers like CFC are trailblazers, offering comprehensive telehealth products. CFC was one of the first insurance providers to offer digital healthcare and cyber insurance, launching their global digital healthcare insurance proposition in 2017. This was in response to an observation that traditional healthcare insurance policies were struggling to draw clear lines between the medical malpractice, technology, and cyber liabilities borne by many insureds.
Andrew Dallamore sums up CFC’s approach, saying, “I think what makes us different that we’ve got affirmative bodily injury coverage across professional liability, tech, and cyber liability, making it a one-stop-shop solution for digital healthcare entities.”
In Conclusion
The digital healthcare revolution is no longer a future concept; it’s here. Commercial insurance agents must embrace this change by regularly updating their knowledge and understanding the comprehensive solutions carriers like CFC offer. The proactive inclusion of cyber liability insurance discussions with clients represents an untapped revenue stream for agents, strengthens client trust, and positions agents as forward-thinking and indispensable partners. The essence of commercial agents’ role is shifting towards guiding clients through this complex landscape.
The changing threat landscape necessitates agents to stay abreast of developments. They must have a thorough understanding of all available insurance policies and the specific risks each client faces. By joining the insurance insiders group, agents can watch regular discussions with underwriters and gain an understanding of the carriers appetites, their policies, inclusions and much more. Join now, to see the full interview with CFC’s Andrew Dallamore.
As the saying goes, the only constant is change, and for insurance agents in the age of digital healthcare, change is an opportunity for growth.
