Consumers, Insurers and Genetic Information

As medicine and technology advance, however, so will the predictive value of such information, and, therein lies the problem. Insurers may soon be hard pressed not to use any and all genetic information that might provide a leg up on the competition as it relates to underwriting coverage. While this may not seem problematic in purely economic terms, indiscriminate use of such information may increase consumer distrust and prevent some consumers from undergoing valuable genetic testing. Thus, maintaining the status quo is not a viable option.

The option consumers seem to favor is to simply ban insurers from using genetic information, much like is done with race, and, in some contexts, gender. Consumers favor this option for a couple of reasons. First, genetic testing can potentially reveal deeply personal information about an individual’s health, such as a genetic predisposition to an incurable disease, and consumers are, understandably, hesitant to share that information with others. Second, history is rife with examples of misuse of genetic information (e.g., forced sterilization of the mentally deficient in the 1960s), and individuals are, understandably, fearful that genetic information may be used to discriminate against specific individuals or groups again in a similar manner.

A number of European countries have already prohibited insurer use of genetic information, including France, Sweden, and Austria. While restricting insurer use of genetic information may alleviate consumers’ concerns regarding privacy and discrimination, it also raises new concerns. Without access, at a minimum, to genetic information that affects the accuracy of underwriting, insurers may be forced to raise premiums to cover the “known unknown,” which would harm a far larger portion of the population than granting blanket access. Thus, insurers and consumers must find a middle ground — one that balances insurers’ need for relevant genetic information with consumers’ concerns regarding privacy and discrimination.

The Middle Ground

The United Kingdom provides a model for a possible middle ground for regulating insurer use of genetic information. Under the U.K. model, insurers are allowed access to genetic information, but can only use the information when it will actually help underwrite customers’ coverage. How is this different from the current status quo? Enter an independent review of the predictive value of genetic information.

For example, since 2001, insurers and the British government have agreed to prohibit the use of genetic information for all insurance policies under a specified amount (e.g., £500,000 for life insurance). However, for policies above that specified amount, insurers are allowed to use genetic test results that have been approved by a governmental body called the Genetics and Insurance Committee. (To date, only results regarding Huntington’s Disease have been approved for use, and only in life insurance applications).

Ultimately, the middle-ground model would provide insurers with the information needed to accurately underwrite customers’ coverage and, at the same time, limit potential privacy violations and discrimination. While careful consideration will need to be given to the standards for determining whether to approve the use of genetic information, the U.K. model presents a strong path forward for building a trusting relationship between insurers and consumers.

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Matthew Bergs is a JD/MHA student at the University of Iowa.

Anya Prince is an associate professor at the University of Iowa College of Law. 

Anya Prince will address this topic during her keynote presentation at this year’s Global Insurance Symposium, and an in-depth analysis of these arguments is forthcoming in the Nebraska Law Review. A draft copy of the paper is available here.