Best's Review


A Healthy Dose of Reality

Discovery Limited’s founder and CEO Adrian Gore talks about understanding behavioral biases around wellness and incentivizing related lifestyle choices, especially during a pandemic.
  • Lori Chordas
  • January 2021
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Photo courtesy of Adrian Gore

Photo courtesy of Adrian Gore


Key Points

  • Journey to Good Health: In 1992, Discovery Limited was created to make people healthier and create a delivery model that is fundamentally different from traditional insurance models.
  • A Bitter Pill: COVID-19, which has revealed inefficiencies in global health care models, is magnifying lifestyle-related risk.
  • Side Effects: The pandemic is driving improved behaviors such as healthier eating.


Exercise has always been a passion for Discovery Limited founder and Chief Executive Officer Adrian Gore. He once took an already grueling travel schedule and added stair running—in hotels and airports and between meetings in his office.

Gore credits that exercise and healthy living with energizing his body and mind, helping to fuel his innovative spirit, which has resulted in several groundbreaking ideas in insurance.

In 1992, Gore—just 28 years old—created a unique rewards-based health insurance model to improve individuals' wellness and enhance their lives.

He put up some of his own money and raised startup capital from Rand Merchant Bank. That allowed him to begin the groundwork for what has become a diversified, multinational financial services provider of asset management, savings, investment and employee benefits, and long- and short-term insurance through its various brands.

Today Discovery impacts more than 46 million lives in 24 markets. The insurtech made a global name for itself with its Vitality business model, which rewards members with inexpensive flights, discounts and other perks for meeting health goals and making positive lifestyle changes such as increasing physical activity, eating more healthfully and getting annual preventive screenings.

Over the years, some of the world's largest insurers, including Ping An in China, Manulife in Canada and John Hancock in the U.S., have incorporated the Vitality model into their own operations and are benefiting from its network of rewards partners, actuarial data and technology tools.

While Discovery remains on the bleeding edge of innovation to improve individuals' health and drive down health care costs, the company—like its peers all over the world—has faced an unprecedented challenge in COVID-19. And as the coronavirus continues to spread, it is uncovering inefficiencies in care models.

But Gore is no stranger to challenges in the health care system. When he began his career as a life insurance actuary in his homeland of South Africa, the nation was heavily burdened by high disease rates, an undersupply of medical workers, and racial inequalities. But as he has learned from that experience and others, in the midst of difficulty often lies opportunity. Today South Africa has a well-developed two-tier health care system, world-class medical professionals and a burgeoning demand for health care innovation, given the diverse needs of its population.

Best's Review spoke with Gore about the genesis of his company, the power of innovation, the challenges COVID-19 is posing to global health systems, and the importance of incentivizing health and wellness in the midst of a pandemic.

How did the idea for Discovery come about, and how is the insurtech using innovation and behavioral science to create a shared value insurance model that rewards individuals for healthy behaviors while driving down health care costs?

When we started Discovery in the early 1990s, there was a clear need for a sustainable approach that integrated traditional medical aids and health insurance. That was the embryo for our vision of building an actuarially sound health insurance organization focused on demand-side management—namely, making people healthier.

At the time, behavioral economics wasn't a well-known field, but we had an intellectual hunch that we could incentivize people to adopt healthier behaviors and embed that into our business model. Over time, the data and results confirmed that hunch. We came to understand that people's behavioral biases around wellness, such as putting off that run or healthy food choice, acted against their own best interests, and we sought to nudge people in the right direction through a behavior change model called Vitality.

The Vitality model is unique in that it prices the value created through behavior change into the cost of insurance. It provides clients with personalized goals, rewards them for meeting goals, captures the economic value created or lower claims, and shares that value with clients by using it to fund the incentives and rewards that drive healthier behavior.

The Vitality model has been proven to drive better health care outcomes, with highly engaged members demonstrating 10% lower hospital admissions, 10% to 30% lower hospital costs and 25% shorter hospital stays. Vitality members in South Africa live 14 years longer than the average insured population. Reinsurers have also validated the long-term mortality impact of Vitality, with members having, on average, 42% improved mortality rates, and highly engaged members showing a 76% reduction in mortality.

Similarly, in our auto insurance offering, highly engaged Vitality drivers in South Africa have 63% fewer accidents than the worst or unengaged drivers, and 77% have fewer severe accidents.

The global pandemic has further demonstrated the important role the insurance sector can play in helping keep its customers healthy.

How important is it to incentivize healthy behaviors, especially during critical times like a pandemic?

Never has our shared value model been more relevant than during the current global pandemic, which has exposed the link between noncommunicable diseases and infectious diseases.

The pandemic has magnified the importance of addressing lifestyle-related risk. Global research demonstrates that more than 50% of COVID-19-related deaths are attributed to individuals with three or more comorbidities, such as diabetes or heart disease. We are now seeing that behavior can determine not only noncommunicable disease risk but communicable disease risk as well.

For example, according to our data analysis of South African cases, a 65-year-old male who does not exercise and has no other chronic conditions has a 55% higher chance of dying from a COVID infection than a 45-year-old with no chronic conditions. In contrast, a 65-year-old male with no chronic conditions and who exercises for 30 minutes four times per week has a risk 22% lower than a 45-year-old who does not exercise at all.

Business models that help make people healthier, while simultaneously lowering the price of insurance, have the potential to make a profound contribution to society by building resilience against both noncommunicable and communicable diseases and helping individuals and health care systems weather severe shocks.

What is COVID-19 revealing about today's global health systems and traditional insurance models?

The pandemic has accelerated three trends that are important for business in general and insurers in particular. The first trend is that the nature of risk is behavioral. Behavioral risk factors have replaced preexisting risk factors, with four lifestyle choices—smoking, poor nutrition, physical inactivity and alcohol consumption—leading to 60% of mortality and 80% of morbidity. The pandemic has also demonstrated the importance of behavior in determining both noncommunicable disease and communicable disease risks.

However, traditional insurance models tend to pool behavioral risk and subsidize individuals who exhibit poor health behaviors. That is not productive or sustainable, emphasizing the need for traditional models to factor in the behavioral nature of risk on an ongoing basis.

The pandemic has also accelerated the rush to an online world. This has seen many barriers fall away as more people seek and use digital health care. The data provided through wearables and health care apps—when used ethically and with consent—can also be powerful assets in monitoring and incentivizing health behavior. Insurers will have to adapt to these shifts rapidly and responsibly.

The pandemic has also revealed that while purpose may have once been a nice-to-have, it is now a nonnegotiable. Going forward, businesses will be expected to reconceive business models to create change at a societal level and respond to the most pressing social challenges relating to financial inclusion and resilience, access to quality health care and education, and minimizing negative impacts on the environment.

We are now seeing that behavior can determine not only noncommunicable disease risk but communicable disease risk as well.

How is the pandemic spurring the need for increased innovation, healthier living, and disease response and management? Have you seen a rise in negative health behaviors during the pandemic and last year's lockdown, and what is Discovery doing to create more positive health behaviors as COVID-19 rages on?

The global pandemic has further demonstrated the important role the insurance sector can play in helping keep its customers healthy. Discovery also finds itself in a unique position to analyze a combination of insurance claims and behavioral data to understand the broader impact of the pandemic beyond morbidity and mortality.

In terms of changing behaviors, we are beginning to see differences in various lifestyle categories at different stages of the pandemic. For example, eating out decreased during initial lockdowns, and home cooking and purchasing of meal kit services increased. On the other hand, outdoor activity decreased early in the pandemic but seems to have picked up again as countries relaxed their restrictions, with subscriptions to at-home workouts decreasing.

We recently conducted an analysis of purchasing data for around 320,000 Vitality members on the Vitality HealthyFood benefit in South Africa, comparing 2019 to 2020. In the pre-lockdown period of January to March 2020, [grocery] baskets were deteriorating, with 2% less healthy foods purchased compared to 2019. However, during the lockdown period, there was an increase in the percentage of healthy foods purchased compared to the same period in 2019. Overall, members purchased, on average, 6.2% more healthy foods during the lockdown in April to June than in 2019. However, there was also an increase in the purchase of unhealthy foods during that time.

Understanding these trends and their drivers has enabled us to tailor interventions such as targeted member communications, boosted rewards, and new offerings that provide healthier alternatives and offer discounts on healthier versions of convenience meal items. We also boosted our HealthyFood benefit to provide a 100% cashback for qualifying Discovery Bank clients, and rewarded Vitality members with Discovery Miles, or virtual currency, as they exercised.

In our motor business, we reduced clients' premiums by 25%, using our telematic insights to identify clients that had traveled low distances. And on the disease management front, we implemented real-time monitoring of every Discovery member who tests positive for COVID-19, with live analytics of the drivers, and are communicating with them to ensure they remain safe.

During the 2020 financial year, we generated 12 billion rand (US$802 million) in the form of shared value for our clients, spanning premium discounts, cashbacks, boosts and value-added benefits in managing care.

We also extended our intellectual property and assets toward supporting the national response in South Africa, such as with our partnership with local telecommunications provider Vodacom. We made our virtual health care platform available to all South Africans during the pandemic, helping to safeguard the health of citizens and providers through cofunded virtual consultations with doctors.

How are you leading your company in this time of disruption, and what types of leadership skills will be needed in the post-COVID world?

The rising societal expectations for companies to act responsibly have now reached a climax. There is now a fundamental recognition that the purpose of business cannot be narrowly focused on making money without regard for how it interacts with the sustainability and well-being of the societies and environments in which it operates.

Often there is skepticism and concern that this is an impractical approach to business, and that at some level there will be trade-offs or conflicts between a company's ability to make a profit and the interests of its stakeholders. But what we've seen at Discovery is the opposite … that through the shared-value insurance model, the company's, client's and society's interests are completely aligned.

The way employees think about their employers will be shaped for a long time by the way they were treated during such a testing time, with resulting differentials in loyalty, commitment and energy. Qualities of trust, empathy and purpose will be critical to leadership going forward.

What are Discovery's future plans, and do you see individuals' approach to health and the ways they strive to enhance their lives changing?

Our overarching goal is to reach 100 million people by 2023. Not only do we want to continue to provide incentives that promote healthy behaviors, but we are expanding our offering to help people better manage their finances, using the same model and powerful tools like mobile banking. Ultimately, the goal is to apply the Vitality model to a range of financial services adjacencies and markets, with technology at the core.

Discovery can continuously evolve its business model by using its massive data asset—over 50 million life years of behavioral-linked insurance data.

An example of this asset at work is Discovery's COVID-19 Resilience Index, which is a generic assessment to help individuals determine whether they have heightened risk factors if they contract COVID-19, based on their existing health conditions, biometrics and lifestyle choices. The intention of this living tool, which is now under academic review, is to help shape the response strategy of companies and governments as the disease develops.

Going forward, we see a continued emphasis on health, technology and purpose, and I believe our organization is well placed to lead in this space. Key to that is the fact that we have been obsessive about the culture, purpose and values of our organization. Our leaders are passionate about prioritizing and driving our culture and making it part of their agendas.

Learn More

Discovery Limited (AM Best # 058603)

For ratings and other financial strength information visit

Lori Chordas is a senior associate editor. She can be reached at

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