Legal and Ethical Implications of Using Wearable Technology by Health Insurance Firms

Reflection Paper Telematic Devices
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The healthcare sector's utilization of telematic gadgets, such as safe driving devices, raises significant inquiries regarding the delicate equilibrium between personal privacy, data aggregation, and the potential advantages for insurance providers and individuals. This paper examines the legal and ethical implications of using wearable technology by health insurance firms to gather health data to determine insurance premiums (Reimers & Shiller, 2019). From a legal perspective, adherence to data protection regulations such as the Health Insurance Portability and Accountability Act (HIPAA) in the United States is crucial for insurance firms when acquiring health data using wearable technology. The Health Insurance Portability and Accountability Act (HIPAA) imposes stringent regulations for collecting, storing, and transmitting health information. If these regulations were implemented in the context of wearable technology, insurance companies would be required to establish robust security measures to safeguard sensitive health information and obtain explicit consent from policyholders for data collection (Eling & Kraft, 2020). Failure to adhere to these regulations may result in significant legal ramifications and the infringement upon individuals' right to privacy.
Using innovative technology to collect health data in the insurance context raises ethical concerns. On the one hand, it is plausible that this initiative might incentivize individuals to adopt healthier lifestyles and engage in proactive healthcare practices, resulting in reduced healthcare expenditures and overall well-being. Policyholders can receive personalized feedback derived from their health data, fostering heightened awareness of their habits and promoting the adoption of positive behavioural modifications (Eling & Kraft, 2020). Moreover, innovative technology can enhance the precision of risk assessment, facilitating the establishment of more equitable insurance premiums contingent upon individuals' behaviours and decisions. However, it is crucial to consider the ethical implications around topics such as consent, discrimination...