NCPA - National Center for Policy Analysis

Life Insurance Industry Confronts Genetic Testing

November 20, 2000

Should life insurance companies be allowed to review the results of genetic tests conducted on potential clients who are applying for policies?

Despite privacy considerations, many experts contend that non-disclosure could spell the end of the life insurance market as we know it. Someone who knows he is prone to a fatal disease and is destined to die soon could stock up on high-payout policies. On the other hand, those whose tests reveal lower risks would buy less insurance.

At present, most governments restrict or prohibit the use of genetic test information by insurers.

Legislation in the U.S. is not yet federal, but insurers in 18 states cannot deny applicants coverage, cancel their policies or charge higher premiums on the basis of genetic makeup.

Last month, Britain became the first country in the world to allow insurers to ask for test results, and although approval has only been given so far to a test for Huntington's disease, 10 other tests are in the works and are awaiting similar approval.

A law in Austria bars insurers and employers from obtaining the results of genetic tests

And in France, the federation of insurance companies has declared a five-year moratorium on the use of such tests.

People who are found to be at high risk due to genetic test results could very quickly find themselves to be uninsurable. This has led some public-policy specialists to suggest that governments may have to step in and provide some sort of safety net for such persons.

Source: "Testing Times," The Economist, October 21, 2000.


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