After completing her first 5km run, Annette Ball was in floods of tears at the achievement.

It was the first milestone on a journey, starting in 2019, that has seen the 56-year-old music teacher from Coventry lose more than three stone in weight and establish a new regime of strenuous exercise nearly every day of the week.

Ball’s story is the kind of inspiring tale of self-improvement that flourishes on social media feeds, but what is more unusual is the company that she credits for getting her moving: her insurer.

A points-based scheme offered by life and health insurer Vitality, which uses a wearable device to track physical activity and offers financial benefits and vouchers for progress, was instrumental to her lifestyle shift.

“The bottom line is that it is insurance, but what it has enabled me to do is get healthier,” Ball says. “It’s certainly changed how I live now.”

It is just one example of a shift that is reshaping the centuries-old insurance sector, fuelled by new technologies and real-time data that insurers are increasingly gathering on their customers.

Vitality calls it “shared-value insurance”, others call it “active insurance”, but the core idea is the same — focusing more and more on preventing and mitigating claims. By working with consumers and businesses to change behaviour and reduce their risks, insurers hope to limit the likelihood and severity of payouts.

Prevention has been an element of the insurance industry for centuries. In the aftermath of the Great Fire of London, the property insurers of the 17th century operated their own emergency services, as they sought to protect themselves as well as their clients. From burglar alarms on houses to wheel locks in cars, insurers have long urged clients to take more measures to avoid thefts that would result in claims.

But smarter and widely available technology means insurers can now intervene earlier and in a greater variety of ways — an accelerating process that is starting to change large parts of the industry.

Companies have been experimenting with using these types of tools in health insurance for more than a decade. They are now increasingly prominent in areas ranging from floods to cyber attacks. Cyber insurance provider CFC has called its support services “digital fire trucks”.

“We’re investing heavily into risk prevention . . . in order to help turn insurance from just paying out to essentially helping people understand their risk and reduce their risk,” says Julian Teicke, co-founder of insurtech wefox. The company raised $400mn from investors earlier this month in its latest funding round and has recently established a research team in Paris to drive its prevention efforts.

The growing focus on prevention has prompted some industry leaders to question what the insurance business will look like in the future. In particular, some question whether the provision of insurance coverage — the financial risk taken by the provider, which has been the backbone of the industry — will end up as just one element in a wider package of services.

“If prevention becomes really something mass market, the insurance product will be a smaller component [in] a broader suite of services,” said Raphaël Vullierme, chief executive of home insurtech Luko, earlier this year.

The winners, he predicted, would be technology-focused groups used to building those services.

Prevention is presented by insurers as a vital tool in dealing with the growing bill from threats such as the obesity crisis, cyber assaults and extreme weather.

For life and health insurers, the aim is to encourage fitter, longer-living customers; for cyber insurers, it is to ensure fewer cyber attacks break through clients’ defences; for motor insurers, safer drivers; for home insurers, it means reducing damage from floods, and catching leaks early.

Customers are incentivised by the promise of lower insurance premiums if they reduce their risks, and companies’ profit margins should be boosted if the fall in claims outweighs those discounts.

Zurich, one of Europe’s largest insurance companies, established a resilience services unit last year with 750 risk engineers working across 40 countries to help companies assess and mitigate their risks.

“We want to keep customers in business and we want to reduce [their] cost of risk,” says Sierra Signorelli, head of commercial insurance at Zurich. The intensifying frequency and severity of storms is a key driver of take-up of resilience measures among companies, she adds.

One of Zurich’s clients is automaker Audi, whose Neckarsulm factory in south-western Germany was hit by the torrential rain storms that hammered Europe in 2016, sending mud and water pouring into the plant, damaging equipment and halting production.

Audi then worked with Zurich’s risk engineers as well as local officials, the emergency services and other stakeholders to strengthen the plant’s defences and those of the surrounding area, including installing new retention basins.

When heavy rainfall hit last year, the factory was ready. Alerted by an early warning system, workers teamed up with emergency services to inflate long water-filled barriers around the facility. Thanks to the countermeasures, the final repair bill was lighter and production did not have to stop.

The cyber insurance market is increasingly a mixture of protection and cover: providers work with companies to patch holes in their digital defences, put in place extra security measures and offer emergency services to restore systems and recover data after attacks.

Cyber insurer Coalition is one of a growing number of companies in this segment of the market and places as much attention on its security services as its insurance policies.

“We look at our customers as if we were playing offence. We are looking for those nails that are sticking out,” says its chief executive Joshua Motta, a former CIA analyst.

Coalition says it scans more than 5bn IP addresses 400 times a month for vulnerabilities. That might be malware in a client’s system, or unpatched software that is vulnerable to hackers.

Some insurers now demand that companies must have basic protections such as multi-factor authentication in order to receive cover, as the sector responds to the surge in ransomware attacks.

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