Name: How the end of apartheid influenced this health insurance company's unique business model
Uploaded: 2024-02-16
Duration: 3 min 9 s
Description: Discovery CEO Adrian Gore discusses the provider's incentive-based: 'When people are healthier we're more profitable.'

Discovery CEO Adrian Gore discusses the provider's incentive-based: "When people are healthier we're more profitable."

How the end of apartheid influenced this health insurance company's unique business model

Leadership

So our company discovery uh is a global life and health insurer. Our our fundamental purpose make people healthier, has manifested in this vitality shared value model that incentivizes people to be healthier and prices that and integrate that into life and health insurance. And we operate in 40 markets across the world with over 40 million lives that we touch. So, so the roots of the company I think are quite interesting because I think today we we world leaders in, in, in behavior change and and factoring that into, into financial services. How we got to where we we we are is as a start of health insurance in South Africa in 1991 and 92. This was just at the time that Nelson Mandela was released and apartheid was coming to an end in South Africa. And the idea was to start a health insurer that would offer a sustainable solution to people. But in our country at that time, there were too few doctors, very terrible levels of disease burden HIV A I DS, the epicenter of that, the illness and government rightly so wanted no discrimination at all. So for health insurance like in the US, you couldn't, you couldn't exclude pre-existing conditions. You couldn't price people differently. So our kind of epiphany, it was really a hunch was, could we make people healthier? In other words, could we could we actually incentivize people to be healthy and bring the price of healthcare down? We couldn't price the risk properly and we couldn't control the doctors because there are too few of them. So we had one simple choice and that was really a kind of entrepreneurial hunch or could we incentivize people to be healthier? That became this very sophisticated vitality, shared value model? Effectively, we share value by sharing incentives with people and making profitability by people being healthier and kind of in that evolution was fascinating. We kind of learned this this very simple truth that we are one of the only industries and when people are healthier, we are more profitable. So we are completely aligned to our customers. If they are healthy, we make money. And so we use that profitability to incentivize better health when you get the shared value cycle. That's kind of how we we evolved on the back of that model, many insurers around the world as as the world emerged into purpose there, as we started understanding behavioral economics and the and the biases of people and as technology started to offer things like devices and Apple watches and all those kinds of things that make measuring behavior much easier. Um you know, this, this model started to globalize. And so companies around the world, insurers around the world uh were very keen to work with us and we developed this repeatable scalable business model and capability and tech and data that we partner our partners with. So that is kind of our, our evolution. But I I have to say the um once you understand that you know mortality that the chance of dying or getting sick is very much affected by behavior, the entire world of financial services is different. I mean, that's an actually our train to learn things of selection, not behavior. But you know, the data is now showing we're seeing it in every issue. Behavior change is so fundamental. So I, I I'm proud of that. I think we're leading the world by industry and how you understand behavior change and how you price it into financial services.