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Genetic Testing An Insurance Timebomb


Published in December 30th, 2008
Posted in Finance and Investment

Insurance policies may not be effected for the time being by the controversial subject of genetic testing following the Association of British Insurers recommendation that customers should not be asked by insurance companies for the results of genetic tests for the next five years.

Like many of ABI s edicts, such as erasing the Raising Standards Initiative, its a voluntary as opposed to a compulsory code. Nevertheless it is excellent news. In practise, not many of ABIs 400 insurers are likely to ignore the recommendations, as it would put their membership of the Association in jeopardy.

The low reliability of genetic tests available at present was recognised by the ABI. For example, simply because a member of their family died from cancer does not mean that they will contract the disease. However the Genetic and Insurance Committee (GAIC) still approves the test for Huntingtons disease as a reliable indicator when underwriting life insurance plans.

On life policies over 500,000, insurers may ask for the results or a genetic test for Huntingtons Disease. However ABI points out that only 3 per cent of all life policies are underwritten for over half a million pounds.

A Parliamentary select committee has expressed doubt about the relevance of the genetic testing for Huntingtons and has requested that GAIC reassesses their decision. It is important that this moratorium is used to debate the subject in depth rather than to use it as an excuse to ignore genetic testing for the next five years. Burying our heads in the sand will only exacerbate the situation, as advances in medical science will be used to develop much more reliable genetic tests within the next five years.

Insurers may then use genetic tests when underwriting policies, leaving us with a genetic underclass, who have difficulty in finding life insurance cover.

Certain insurers like the Co-operative Insurance Society, are suggesting a public/private solution to solve the problem. They recently used an all encompassing moratorium on the underwriting of life insurance based upon the results of genetic tests. Using these tests will be expensive so it is only reasonable that the Government should share the burden with insurers.

An impartial complaints system will be established by the ABI so that consumers have adequate redress if they consider that the insurance companies have treated them unfairly. At present there are no details of how a system of this kind would work, but of course it needs to deliver solutions, which really deliver and be completely independent of the insurance industry. The ABI will police the moratorium themselves, which raises concerns about whether consumers will receive an unbiased hearing. The encouraging announcement by the ABI will be an empty promise if they dont.

A Joint Statement of Concern has been presented to a House of Commons Cross Party Group. Forty six organisations and individuals have called upon the Government to legislate against the use of genetic test results in insurance.

They are concerned that there is no legal framework to prevent the use of genetic testing by employers and insurers to make decisions about who gets insurance. They also consider that testing is not a reliable or conclusive predictor of a persons future health.

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