Insurers want to lure us with the promise of cheaper premiums, but should we let them spy on us?

“AT THE end of the day, the insurers are only going to want to insure those people that are fit and healthy and don’t need anything done to them.”

Nineteen Eighty-Four (1984) is a sci-fi film based on the George Orwell novel, which comments on free speech, free thought, f...

HOW would you feel if your insurer was breathing down your neck every time you chowed down on a sneaky burger?

And what if their surveillance meant you were no longer eligible for cover? How about if you had to submit to genetic testing, which could exclude you from taking out an insurance policy because you got unlucky in the genetic lottery?

It sounds like something from a Utopian novel, but all of these scenarios are looking increasingly possible as technology and proposed law reforms collide.

Insurers have been snooping on our driving skills for years, and now they’ve got their eye on our eating, exercise and partying habits.

In an Australian first announced today, MLC is offering Australians a discount on their life insurance policies it they agree to wear an Intel smart watch — and improve their habits.

LONDON - JULY 12: In this photo illustration a lady eats a beefburger on July 12, 2007 in London, England. Government advisors are considering plans for a fat tax on foods high in fat to try to help tackle the fight against obesity. (Photo by Cate Gillon/Getty Images)

It’s the health equivalent of the black box device that car insurers like QBE use to spy on drivers, giving their more responsible clients a discount on premiums.

MLC customers will be ranked on their daily step count, time spent exercising, sleep duration and average resting heart rate.

Then they will have between 90 and 160 days to achieve their “target wellness score” to receive a five per cent discount.

Each customer gets two shots at the challenge; if successful, that means a 10 per cent discount off their premiums for the life of their policy.

But is it worth it, and is this the way we want the world of insurance to be heading?

Intel’s Basic Peak smart watch will monitor MLC customers’ eating, sleeping and exercise patterns.

MLC’s announcement comes after Federal Health Minister Sussan Ley flagged the possibility of changing the law so that smokers could be charged more for their health insurance premiums — as advocated by NIB chief executive Mark Fitzgibbon.

Ms Ley said she had not ruled out making changes that could see the “community ratings system” scrapped.

That’s the system that ensures everyone pays the same for their health insurance, regardless of their smoking status, age or fitness level.

While the instinctive reaction for many nonsmokers is “make them pay”, we have to ask where do we draw the line?

Should people who eat sugar be penalised? What about that carcinogenic national pastime, drinking?

How fat should we be allowed to get before we are excluded from insurance, or our premiums made impossibly unaffordable?

Australian Minister for Health Sussan Ley delivers her address to the National Press Club in Canberra, Wednesday, Oct. 28, 2015. (AAP Image/Lukas Coch) NO ARCHIVING

Then there is the issue of genetic testing by insurance companies, which the Australian Medical Association has warned could result in the people who need cover most being excluded.

AMA President Professor Brian Owler said the technology could “predict very accurately whether someone is going to, or likely to, develop a certain condition or disease in the future”, with dramatic potential consequences.

“So, are those people going to now have to have genetic testing, and if you’re positive for a genetic test are you going to be denied cover?” he said on 2UE radio.

“These are the sorts of bigger policy questions that we need to be asking.”

Prof Owler said that while the association had a long history of advocating against smoking, bumping up premiums was not the answer.

“It runs the risk of really interfering with our private health insurance sector, particularly when it comes to risk rating, because it won’t stop at smoking,” he said.

“You know that obesity and all sorts of other issues are going to be brought into play in the future and, at the end of the day, the insurers are only going to want to insure those people that are fit and healthy and don’t need anything done to them.”

David Hackett, executive general manager insurance at MLC, believes the smart watch program will shake up the insurance industry and encourage Australians to live healthy lifestyles.

“The insurance industry has assessed risk in the same way for a long time, but smart watches offer new and improved ways of assessing and pricing insurance risk,” Mr Hackett said.

“Our customers’ expectations have been changed by the use of digital channels and devices ...

In today’s environment, it’s imperative that we are agile and adaptive.”

The Federal Government this week launched its public consultation on the private health insurance industry, with an online survey that will close on December 4.

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