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By Leslie Scism 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (October 29, 2019).

Manulife Financial Corp.'s John Hancock unit will market life insurance to Americans with diabetes that includes a behavior-change program and virtual clinic, in an effort to boost sales by making life-insurance products more user-friendly.

Those services, announced Monday, will be provided through Onduo, a joint venture under way since 2017 between Alphabet Inc. unit Verily and French pharmaceutical group Sanofi SA. Alphabet is the parent of Google.

Approximately 30 million Americans have diabetes, according to the federal Centers for Disease Control and Prevention. People with the disease can pay between 50% more to triple what healthy people pay for life insurance, insurance executives say.

Hancock's partnership aims to tap this market in an effort to rev up sales. Individual life-insurance policy sales have fallen about 45% industrywide since the mid-1980s, to flatten out at about 9.6 million policies annually in recent years, according to Limra, an industry-funded research firm.

The slide occurred as mutual funds and 401(k) savings programs proliferated. Today, many Americans worry more about outliving their savings than dying prematurely, executives say.

"We are selling a product that no one gets excited about owning," said Brooks Tingle, chief executive of John Hancock's life-insurance business. He said the Onduo partnership "is all about being meaningful while the policyholder is living" -- not simply paying a death benefit.

Onduo uses a smartphone app to link people with Type 2 diabetes to medical professionals, dietitians and counselors. It provides "coaches" to help participants set and meet health goals and offers text messaging, food photo logs and glucose tracking. The program also provides videoconferencing with doctors.

Healthy lifestyles and good medical care are widely credited with helping people with diabetes improve their health, though it remains to be seen how Onduo's emphasis on care through smartphones will add to the mix.

The Boston-based Hancock has offered financial rewards to policyholders who hit fitness and health milestones since 2015. People with diabetes who buy Hancock's new "Aspire" policies also will be eligible for such rewards, which are tied to activities including exercise, healthy grocery purchases and meditation, Mr. Tingle said.

Onduo will keep health data collected from the Hancock customers and won't sell or disclose it to other parties, beyond confirming people's usage in general terms for the rewards, the insurer said.

Many life insurers do insure people with diabetes, though guidelines differ across companies, said Nicholas Mancuso, a manager at Policygenius.com, a site for consumers to learn about products and comparison shop.

A healthy 30-year-old male can pay $26 to $55 a month for a $750,000 term-life policy that lasts 20 years, while premiums for a 30-year-old Type 2 diabetic with a controlled condition and no complications can range from $52 to $124 a month for the same policy, according to Policygenius.

Insurers address health status through the underwriting process. Underwriters typically study an applicant's family medical history, as well as personal medical records and prescriptions, and conduct a medical exam, which includes analysis of blood and urine samples.

Under conventional practice, insurers don't know if -- five or 10 years past the initial underwriting -- a policyholder with diabetes has made strides in controlling the disease, or deteriorated in health, Mr. Tingle noted. At Hancock, Aspire policyholders will be eligible for discounts of as much as 25% annually if they achieve health goals.

"We think people taking steps to manage their diabetes are probably paying too much for life insurance" over time, Mr. Tingle said.

Write to Leslie Scism at leslie.scism@wsj.com

(END) Dow Jones Newswires

October 29, 2019 02:47 ET (06:47 GMT)

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