Genetic Tests Underwriting Ban – Your View

The impending ban on the use of genetic test results in life insurance underwriting forms the basis for our latest poll.

On the surface, all the boxes appear to be ticked in terms of doing the right thing by the industry and the broader community.

From the community perspective, a ban on using genetic test results in the underwriting process will result in delivering much greater confidence to all Australians, providing peace of mind for those who may have been wavering as to whether they should undertake such a test, in the event any adverse findings might impact their ability to access much-needed life insurance in the future.

…it has never been life insurers’ intention to deter people from taking genetic tests that give them more information about their overall health

As CALI chief, Christine Cupitt, noted in our report on the Government’s proposed ban (see: Ban on Use of Genetic Test Results Welcomed), it has never been life insurers’ intention to deter people from taking genetic tests that give them more information about their overall health.

From the industry perspective, there is a rationale which argues the ban on use of predictive genetic tests in life insurance underwriting will contribute to generating higher levels of community trust in life insurance and lead to more Australians taking out life cover. Cupitt again:

“…the more we increase overall trust in life insurance, the more people will engage with it.”

On the other side of the coin, it might be argued – especially given the increase in the number of genetic tests now being undertaken – that this impending ban may contribute to skewing the overall quality of the life insurance pool, potentially placing upward pressure on premiums for every insured life and policy owner in the pool.

Logically, under a total ban on using the results, a prospective life insured in receipt of an adverse finding from a predictive genetic test may tend more towards taking out life insurance cover. Meanwhile, someone who receives a positive test outcome might continue to take out life cover but they may also reconsider applying, given the known odds of longevity have shifted slightly more in their favour.

…the vast majority of the 15 million Australians who hold life insurance cover obtained it without ever having to disclose the results of a genetic test

Countering this argument, Cupitt rightly notes that other underwriting checks and balances remain in place and that the vast majority of the 15 million Australians who hold life insurance cover obtained it without ever having to disclose the results of a genetic test.

Where do you stand on this question? Is a total ban on predictive genetic tests in life underwriting the right way to go? Or did the industry have it right when it was following the moratorium path over the last five years which precluded any genetic test results from consideration on life insurance applications under nominated benefit limits?

Tell us what you think and we’ll report back next week…