New Delhi, Sept. 27 -- Health insurance is no longer limited to paying claims when you fall ill. Insurers are increasingly using wellness programmes to encourage policyholders to exercise, stay active and adopt healthier habits, with rewards linked to activities such as walking, swimming or cycling.

But these benefits can come with a trade-off that consumers may overlook. To participate in some wellness programmes, policyholders may have to share personal health and fitness information through apps, wearables or connected devices. That can include step counts, exercise patterns, sleep cycles and even diet or water-intake logs.

For consumers, the key question is not just what they can earn from a wellness programme, but also what happens...