The Johannesburg High Court’s dismissal of Discovery’s case against Liberty Life has thrust into spotlight the question of who owns our personal data has the potential to change not only the business of life insurance, but other industries too.
On Wednesday, Judge Raylene Keightley dismissed with costs Discovery’s attempt to block the Standard Bank-owned insurer from awarding people wellness bonuses based on their Vitality Life statuses.
Discovery said it respects the ruling and does not intend to appeal the decision.
Clarifying trademark infringement
Discovery took Liberty to court last year, saying that the latter infringed on certain Discovery and Vitality trademarks in the marketing its Wellness Bonus product. It viewed Liberty’s calculation of customer wellness bonuses based on their Vitality status as an attempt to piggyback on the success of Vitality’s shared value model, without first seeking permission from the behaviour-driven insurer.
Other insurance companies abroad, such as Manulife in Canada and John Hancock in the US, have agreements with Discovery to use Vitality. Locally, Discovery has entered into partnerships with various pharmacies, gyms and retailers, who all had to sign an agreement with the company.
But Liberty’s use of Vitality status differed from how these companies integrated Vitality in their insurance products. The court ruling shows that Liberty used the words “Discovery” and “Vitality” in its marketing of the Wellness Bonus only when it wanted to ascertain which wellness programme a customer belonged to.
“Nowhere is there any suggestion by Liberty, through its use of the trademarks, that it is a Discovery Vitality rewards partner,” said Judge Keightley, before concluding that Liberty’s use Vitality status “is not trade use”.
Who owns the data?
Professor of intellectual property law at the UCT’s commercial law department, Caroline Ncube, said while Discovery’s case was based on trademark infringement and unlawful competition, the Court also clarified the question of who owns customers’ data.
“Highlights from the decision are that a Vitality member’s Vitality status is their personal information and can be made publicly available,” she said.
So, on the question of whether companies who use their innovation to generate the said data have a claim on it or can dictate how it is used or not used, Ncube said the answer is not a straight yes or no.
“Where people have paid for personal information – here, Vitality status – and that information is not confidential and can be made public, they can use it for whatever lawful purpose they want,” said Ncube.
But she added that this does not mean that in all cases companies who generate the data do not own it. “The decision is specific to the facts of this matter,” she said.
The precedence set by the Court on the use of third-party data has opened numerous possibilities, not only for Liberty but the insurance industry and other sectors, said Liberty’s executive of retail solutions, David Jewell.
“The outcome of this court case establishes a bunch of principles we can leverage on. The various data sources that this can open up if customers wilfully provide it can allow us to risk rate clients more appropriately,” he said.
Data on where people travel, how much they travel, what they buy can and social interactions can all make its way to determine how much people pay for their insurance cover. Even borrowing processes from ecosystems outside of insurance is withing grasp now, he said.
With the case behind it now, Liberty says it’s going to market its Wellness Bonus feature again, as brokers had become sceptical of recommending it to their clients.