(Reuters) - Philip Morris’ (PM.N) new UK life insurer, Reviti, is looking to take its “get a discount if you vape” model to Japan, where the tobacco giant has a more than 70% share of the heat-not-burn market.
Reviti Chief Executive Dan Pender told Reuters that the insurer was spending time looking at the Japanese market because it has a significant number of people who smoke and boasts many vaping products.
“We think the Reviti proposition would work extremely well for Japanese consumers,” he said.
Most insurers have long treated smokers and vapers the same, meaning they can pay close to double the premiums of non-smokers. Reviti, however, offers a discount of up to 15% for vapers in Britain. Customers who quit tobacco and nicotine altogether get a discount of up to 50%.
Pender said the insurer was working with a number of established Japanese insurers and looking at how to launch.
Philip Morris’ iQOS heat-not-burn product dominates Japan, which has emerged as a fertile test ground for the vaping industry, offering opportunities for the start-up insurer to grow.
British American Tobacco (BATS.L) has said it would launch two new tobacco heating products in Japan.
Pender said Reviti could disrupt the market in Japan, where most life insurers work on aggregate rates, meaning they do not distinguish between smokers and non-smokers in terms of prices.
“If you’ve got somebody who is a heavy smoker and they say I kind of know smoking is bad for me, but my insurance premium is the same for someone who doesn’t smoke, explain that to me,” he said.
Reviti’s move to Japan comes as deaths in the United States from a mysterious respiratory illness tied to vaping have risen to 52.
Health concerns about vaping have grown despite evidence showing e-cigarettes help smokers to quit, and have led to bans in some countries including India and Brazil.
Reporting by Noor Zainab Hussain in Bengaluru; Editing by Steve Orlofsky