No Fitbit, no insurance? Could this be Australia’s next Royal Commission?

Decorative image showing arm wearing a fitbit device

Australia has seen its fair share of royal commissions: from construction in 2001 to financial services and aged care in 2019,  … just go to Wikipedia and look at the list. So imagine your insurance firm is next. Far-fetched? Well, consider the emerging practice to tie insurance policies to your Fitbit data. We have seen examples in Australia, Europe, and the United States.

Over the last few years, the popularity of wearable fitness devices has exploded since their introduction in the consumer market. Data by market research firms predict that the global market of wearables will more than double by 2022, and that total revenue of the wearables market is expected to reach $150 Billion in 2026. Yet, wearables are being embraced not only by consumers, but across various industries since they provide new opportunities to gather real-time consumer data with the goal to improve business decisions. Currently, these business models work as ‘carrot’ or incentive. That means consumers can benefit from discounts and cheaper premiums if they are willing to share their Fitbit data. But what if voluntary participation becomes mandatory (i.e. from carrot to stick)? In the United States, John Hancock, one of the largest life insurance companies switched this year to “interactive” policies, that is, customers are now required to track their fitness and health data through wearable devices. So, is this the beginning of a major trend? Could this happen in Australia?

The growing popularity of wearable technology and the commercial interest of persuading consumers to self-track and share of personal, biometric data has led to a new debate among legal scholars with regards to regulatory frameworks that would protect consumer privacy. But what do consumers think? In my latest article “Persuaded self-tracking with wearable technology: Carrot or stick?” published in the Journal of Services Marketing, my co-author Professor Stefanie Paluch, RWTH University in Germany, and I investigate the implementation of smart wearables into insurance policies from a consumer perspective. We found that the success of behavioral-based insurance policies is mediated by consumer perceptions and reactions. Specifically, violations of privacy, justice, and moral norms will increase consumers’ tendencies to resist those policies. Strongest opposition is based on consumers’ fear of unfair and exploitative behavior of commercial data users, in particular switching from voluntary to mandatory enrolment. Our framework helps insurance firms as well as public policy makers to better understand three main types of consumer perceptions (value, privacy and fairness) and four types of consumer personas (embracing, considering, debating, avoiding).

As the sharing of personal biometric data will further increase, we hope that our findings will contribute to an emerging public policy and legal debate – and hopefully avoid another Royal Commission.


Dr. Sven Tuzovic is Senior Lecturer (US Associate Professor) in Marketing at QUT Business School in Brisbane, Australia. In 2020 he was Visiting Research Scholar at the Gabelli School of Business at Fordham University Lincoln Center in New York. Before joining QUT, he was tenured Associate Professor at Pacific Lutheran University and Visiting Professor at Griffith University, Murray State University, and the University of New Orleans. He holds a Doctoral Degree in Marketing from the University of Basel in Switzerland, a Master’s Degree from the Catholic University of Eichstaett-Ingolstadt, Germany, and a BBA from Georgia Southern University. His research has been published in leading academic journals including the Journal of Service Management, Journal of Services Marketing, Journal of Retailing and Consumer Services, and in international conference proceedings. He has won three Best Paper Awards and a Faculty Research Award at Pacific Lutheran University. Dr Tuzovic has been Associate Editor of the Journal of Services Marketing since 2014.


  1. avatar
    Professor Melinda Edwards Reply

    The number of recent Royal Commissions is evidence that traditional approaches to ethics training and education haven’t worked. In all sectors. Ethical issues are a complex problem and a new approach is clearly required. That’s why QUTeX has applied complexity and systems thinking to develop an integrated inter-disciplinary approach to this critical issue through our new Masterclass Series. Each of the six sessions cover a different perspective, which when combined, demonstrate how to create an ethical decision making system for the real-world. If this interests you, please join us!

  2. avatar

    To tie insurance policies with wearables such as a Fitbit is certainly an area open up to ethical and legal debate. There certainly needs to be more public debate and clear legislation in place for such practices by the insurance agencies. Questions will need to be answered about what are the repercussions of sharing such information, other than just lower premiums. Will clients be required to meet movement targets? If they don’t do a certain amount of movement what are the consequences to their policy etc. This is a complex area on so many levels including ethical, medical and legal.

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