AIA Australia’s new client engagement program, Vitality, has been awarded five stars for innovation excellence by CANSTAR.
The 2014 CANSTAR Innovation Excellence Awards showcase products and services which are an industry first, or open up new markets. AIA Australia was the only life insurer to be recognised in the Awards.
Providing incentives for people to take more control of their health can only be a positive thing
According to CANSTAR, AIA’s Vitality program provides ‘superb’ health (and other) benefits to consumers. The researcher described the program as ‘easy to understand’ and ‘affordable’.
‘Providing incentives for people to take more control of their health can only be a positive thing,’ CANSTAR said in its report.
Piloted by a select number of advisers in 2013, AIA Vitality was introduced to the open market earlier this year (see: AIA Vitality Officially Launched). The program was also recently recognised in the Association of Financial Advisers/Plan For Life Life Company of the Year Awards, picking up the Award for Risk Product Innovation.
The Vitality program motivates members to achieve their personal health goals by offering a wide variety of monetary rewards (such as discounted airfares and department store gift vouchers). It is based on studies into behavioural economics which show that financial incentives can influence people to adopt healthier behaviours.
Professor Kevin Volpp, Director of the Center for Health Incentives and Behavioral Economics at the University of Pennsylvania, believes that new solutions need to be created to deal with people’s ‘predictably irrational’ habit of serving their immediate desires at the expense of their long-term wellbeing.
“With many health-related activities such as exercising or healthy eating, the benefits and rewards are not always obvious or are delayed,” Professor Volpp said. “Therefore, it’s not surprising that most people would rather hit the snooze button than go for a morning jog or gym session.
“By recognising that desires, distractions and urgencies of the moment often get in the way of people pursuing what’s best for their health, government and organisations can enhance the benefits of healthy choices by including well-designed rewards as part of public health programs.”
AIA Australia set out to demonstrate this premise, by hosting a social experiment in Federation Square earlier this month.
A food truck was positioned in the busy central Melbourne location, offering customers hot jam donuts. However, when customers approached the truck, they were urged to swap their donuts for a healthy fruit salad, by a seller using one of two tactics:
- Providing nutritional information about the two food options and encouraging people to switch to the healthy choice
- Offering a financial reward and subsiding the cost of the fruit salad to people who chose the healthier option
When customers were simply told that the fruit salad was the healthier option, 95% still refused to give up their high calorie, fatty snack.
Many of us, no matter how much willpower we have, need an additional ‘nudge’
However, 40% of customers swapped the donut for a fruit salad when it was discounted and they were offered a $10 Myer voucher – demonstrating that a significant number of Australians will respond to financial incentives when deliberating over making a healthy choice.
Peter Crewe, CEO of AIA Australia, said that the results from the social experiment were consistent with overseas research, which found that subsidising the cost of healthy food and providing immediate rewards for healthy choices can have a positive impact on health behaviour.
“Many of us, no matter how much willpower we have, need an additional ‘nudge’ to make better decisions about what we eat. This experiment reinforces our view that incentive-based programs such as AIA Vitality can have significant results in encouraging healthy behaviours in Australia.”
