I am thrilled to share my recent experience from Davos this year. Participating in a panel on longevity was not just an honor but also an enriching journey, offering deep insights into how we, as a global society, are reshaping our understanding and approach to longevity. The World Innovation Economics (WIE) is a UK Company interested in emerging technologies, innovations, research and product development activities. As a part of its released tech products like 'The Wie-App' and 'Quantumfai.com', the WIE run the Davos Innovation Week every year, to promote innovations, especially for start-ups.
In collaboration with the Swiss Finance and Technology Association (SFTA), the leading Fintech Hub in Switzerland, this year's event covered an eclectic list of topics from varying disciplines such as #metaverse, #AI, #Defi, #healthcare, and of course, #longevity. More speciticaly, the topic discussed on the first day was "Healthcare Horizons: Insights from Leaders in Longevity & Healthcare Innovations," where I was fortunate to be invited to take part.
Our panel started with Jade Cano, a journalist and a profeesional moderator, who set the stage for the discussion by framing "Longevity" as a universal journey that unites everyone. Cano emphasized the importance of exploring longevity and aging through various lenses such as technology, healthcare, finance, and societal impact. Elisabeth Roider, MD, PhD, MBA, Partner and Medical Director at Maximom Capital, discussed investment trends in longevity, emphasizing it as an emerging market. Roider explained that investing in longevity is not only financially savvy but also a commitment to improving the quality of life of people as they age.
Nadine Esposito, the Head of Fintech for Longevity Chapter at SFTA, brought a fresh perspective from the fintech sector, highlighting the potential at the intersection of technology and aging. She emphasized the role of financial technology in revolutionizing approaches to aging and long-term financial planning. Consequently, Barbara Radtke, a healthcare sector entrepreneur from Switzerland, provided a practical view from her extensive healthcare background. She emphasized that elder care is not solely about medical needs but also about holistic well-being, advocating for a comprehensive approach to senior care. And ultimately, Carla Bedard Pfeiffer, the Global Health Impact Leader at Roche, highlighted the importance of innovative healthcare solutions, stressing that Roche's mission goes beyond drug development to creating accessible and sustainable healthcare ecosystems.
Together, the panelists provided unique perspectives and expertise, contributing to a comprehensive discussion on aging and its various dimensions. Their insights shed light on the challenges and opportunities associated with longevity, offering valuable considerations for addressing them in the future. The panel was a vivid representation of the global conversation on aging – a conversation that is increasingly vital as we face the realities of an aging population.
Here is the transcript of my humble contribution to the discussion, with the questions by Jade Cano and my answers.
Please describe briefly what it means to be “living in the age of longevity”…You help banks, asset managers and insurances understand the financial needs of older adults and their families…Aren’t these companies already proficient at long-term financial planning? Why do they need to rethink their products and the way they advise clients?
As life expectancies increase, the financial needs of older adults become more complex and extended. Traditional retirement planning models may no longer suffice, requiring more nuanced products that cater to longer lifespans and changing health care requirements. Let’s start by distinguishinh between financial planning and longevity planning. Financial planning is a broad `process that involves creating strategies for managing finances to meet life goal. At the same time, longevity planning specifically focuses on the financial challenges and opportunities associated with a longer life span.
For example, it concentrates on ensuring financial stability and healthcare needs in the later stages of life, often extending beyond the traditional retirement age (in contrast to the traditional accumulation and de-accumulation models), beyond issues like the risk of outliving assets, long-term healthcare costs, life insurance, estate planning, it also considers lifestyle choices impacting employment, health and well-being in later years.
Now, I would like to ask how much of a role does it play in which country I live in terms of what type of care I will get now and in future…and which countries are trend-setting?
Both the Indian and the Chinese countries are taking the aging trend very seriously. The size of the population in both countries is quite the same, however China’s population has reached its peak and India’s population is still growing. The median age of India is 28 while in China it is 10 years more. In 2050, 26% percent of the Chinese population will be 65 and above while the equivalent percent in India is about to reach 14%. It’s really unbelievable but the size of the old population in China in 2050 isgoing to be larger than that of the USA.
India and China are enhancing their healthcare infrastructure to cater to the needs of a growing older population. Nevertheless,China’s economy is more developed than India’s, which influences the irrespective abilities to allocate resources for aging populations. China has more financial leeway to invest in healthcare and social services, whereas India is still working on basic healthcare access for its entire population. The aging populations in both countries raise concerns about the sustainability of pension systems and the economic impact of a shrinking workforce. This leads to policy considerations around retirement age, pension reforms, and incentives for later retirement. Traditionally, both societies have relied on family-based care for the elderly. However, China is more advanced in integrating technology into elder care, with developments in telemedicine, AI, and digital health services. India is progressing in this area but at a slower pace than China.
We talked at the beginning about the need to change the way financial companies approach these topics…In regard to Open Banking, how far are financial institutions in opening up their platforms to third parties?
Open Banking is playing and will continue to play a significant role in longevity planning, particularly by enhancing the way financial data is managed and utilized. In regions like the EU and the UK, Open Banking regulations mandate banks to open up their data to authorized third parties. The result is more personalized financial planning tools tailored to the unique needs of individuals, including those in their later years. With access to a person’s complete financial data, advisors can provide a more holistic view of a client's financial situation and better assess risks, not only with regards to the potential for outliving assets, but also by including health data (medical health records) into longevity planning. Interestingly, there are already companies that are doing so by using a questionnaire (and later on will be using AI). The result is a more nuanced financial plan for later life, given a person’s current medical conditions and the likelihood of experiencing different types of diseases which in turn, affect life expectancy and out-of-pocket medical expenses.
Can you also describe how insurance companies have to change the way they do business?
The insurance industry is witnessing a paradigm shift. Moving beyond traditional underwriting and claims, we're seeing aproactive approach where insurance companies are leveraging digital health apps to promote healthier lifestyles among their customers. These apps, by tracking and incentivizing healthier behaviors like exercise, good sleep habits, and mental wellness, are not just tools for risk mitigation; they represent a fundamental change in how insurers interact with and support their clients. But it's not just about reducing the likelihood of chronic illnesses. The future of this industry will likely include incentives like cash backs on premiums for maintaining healthy habits, which can transform the traditional insurance modelinto a more dynamic and interactive one. Looking at the broader picture, as we embrace the age of longevity, there’s an emerging market for insurance products tailored to specific diseases. These products are not just financial safety nets; they also acknowledge and address the unique challenges faced by individuals and families dealing with long-term health conditions.
Should we allow all financial companies access to our health files? What if I can get a better deal (premium/ deal/ mortgage) if these companies don't know about my lifestyle or medical conditions? What if I don't even want to know about my medical condition?
This is a very good question. It's crucial that any sharing of health information is based on explicit consent and that individuals have control over what information is shared and with whom. This question involves issues of privacy, personal autonomy, and potential benefits or drawbacks with laws in many regions, including GDPR in Europe and HIPAA in the United States. In some cases, sharing health information with financial companies could lead to more favorable terms, such as lower insurance premiums or better mortgage rates, if the data suggests a lower risk profile. Also, as I mentioned before, health data can improve longevity planning thus leading to amore nuanced financial planning for the later years. On the flip side, there'sa risk of discrimination or unfavorable terms if the health data indicates ahigher risk. This could be particularly concerning for individuals with pre-existing conditions or certain lifestyle factors. And as you mentioned, some individuals may choose not to be aware of their medical conditions for various reasons, including avoiding anxiety. The right not to know one's genetic or medical information is recognized as an important aspect of patient autonomy in medical ethics.
From the perspective of financial companies, widespread access to personal health data by financial companies could fundamentally change the nature of risk assessment in insurance and other financial services. It raises questions about the principles of risk pooling and shared risk, which are central to the insurance model.
In conclusion, while there could be potential benefits to sharing health information with financial companies, such aspersonalized products and services, this must be balanced against the risks of privacy invasion, potential discrimination, and ethical concerns.