UPDATE: Understanding Genetic Testing and Life Insurance
The life insurance industry in Canada recently announced new measures it will take to protect clients from discrimination in regards to genetic testing. However, skeptics caution that the changes will not protect consumers from being unfairly targeted.
Anyone applying for coverage up to $250,000 will not be required to provide genetic testing information or results from previous tests. Companies may ask individuals for genetic testing information for greater insurance amounts, but not if the tests were taken for medical purposes or if the outcome is unknown. Family members of the applicant will not be required to undergo genetic testing.
“What we wanted to do is ensure the vast majority of Canadians would be able to buy life insurance and not need to worry about this issue of genetic test results,” Frank Swedlove, president and CEO of the Canadian Life and Health Insurance Association, said in an interview.
The advancement of technology in the medical field in Canada has opened the door to new testing methods and new information about our makeup as humans. One area that has grown significantly in recent years is genetic testing.
Genetic testing uses blood and body tissues to detect genetic disorders. When doctors identify these disorders, they can begin treatment immediately — whereas in the past, treatment would commonly not begin until signs of the genetic disease were present.
Currently, there are more than 33,485 genetic tests available. Many of these tests positively impact the way people approach their lives. According to MedCan, approximately two-thirds of people who take part in genetic testing make a change in their diet and level of physical activity. Additionally, about half of these people also take part in more medical screening tests.
The Impact of Genetic Testing on Life Insurance
One hot-button topic that has received a lot of attention recently is life insurance and genetic testing.
The passing of Bill S-201 in April, 2016 to prohibit discrimination based on genetic predispositions has started a great debate. On the surface, the bill sounds great. Discrimination should not be tolerated on any level and genetics are extremely sensitive and personal.
The Bill has been vocally contested by the life insurance industry, however after being passed by the Senate, it is now under the consideration of the House of Commons.
Is “genetic discrimination” such a huge problem that an Act of Parliament is needed? The proposed law, spearheaded by MP Robert Oliphant and Senator James Cowan, has three main points:
- The creation of a Genetic Non-Discrimination Act that would prohibit the disclosure of genetic test results as a condition of providing goods and services, specifically health and life insurance.
- An amendment to the Canada Labour Code preventing employers from demanding genetic testing or the disclosure of results from employees.
- An amendment to the Canadian Human Rights Act prohibiting discrimination on the base of genetic characteristics.
The last two points are not overly controversial because existing legislation preventing discrimination technically includes genetics. The Canadian Human Rights Act prohibits discrimination on the grounds of genetic predispositions such as sex, race, colour, ethnic origin, sexual orientation and disability. A genetic condition can be considered a type of disability.
The main concern is the insurance issue.
Insurance companies use a certain amount of discrimination to determine eligibility and rates. They examine your medical history, the history of your family and current status (habits, occupation, age and weight) to evaluate your risk level. Factors such as a family history of cancer or high blood pressure could increase your premiums or cause your application to be denied.
Canadian insurance companies don't request genetic tests. However, if you have been tested, they can ask you to disclose the results.
Debate is More About Fear Than Genetics
Insurance companies fear that a potentially high-risk client – someone genetically predisposed to breast cancer, for instance – could buy a large insurance policy at the same rate as a someone without the cancer gene. With the ban in place, the industry might feel it's necessary to increase premiums across the board.
The side in favour of the bill, like the Canadian Coalition for Genetic Fairness, fears that being forced to disclose genetic testing and the results, will discourage people from being tested. This could lead to a delay in diagnosis and treatment. It could also discourage Canadians from getting life insurance due to the high premiums for being a higher-risk.
Timothy Caulfield, director of research at the Health Law Institute at the University of Alberta speaks of other fears: The rash of horrific predictions regarding the evils of tampering with genetics and the fears that followed the decoding of the human genome, such as an army of clones, designer babies and the creation of a genetic underclass.
Full human genomes can now be decoded for about $5,000 and there is data on over 32,000 genetic predispositions. However, the link between genes and the development of diseases is very complex.
In Policy Options, Professor Caulfield writes, “There is little evidence to support the idea that genetic discrimination is a big problem. If it does happen, it certainly doesn’t happen on a scale that would classify it as a pressing policy dilemma,”
A major argument for a genetic non-discrimination law in Canada is that many countries, including the U.S., already have such a law. The difference is that the law in the U.S. was created to prevent people from being denied health insurance coverage for medical care. We have a health care system in Canada that covers everyone, without discrimination. The only type of insurance at issue is supplementary health or life coverage where “discrimination” is part of the assessment process.
Insurance providers must be able to accurately assess the risk involved in providing someone an insurance policy — which can significantly impact insurance policy pricing. Logic would assume that if you were deemed higher-risk for a genetic disease, you would pay a higher premium. Plus, if after genetic testing, you are found to not have any signs of a genetic disease, you would be deemed low-risk and pay a lower premium.
From an insurer’s perspective, if an individual’s genetic information is available, then you could argue that it should be shared with an insurance provider to accurately assess risk as this form of testing can be very helpful in determining the probability of a future disorder. In this sense, genetic testing results are part of your medical history.
From the consumer’s perspective, there are obvious concerns about discrimination, even though it is difficult to determine the number of cases that have occurred. However, the main benefit of genetic testing is that you will understand the risks you are exposed to and will be able to take preventive actions much sooner.
The Canadian Life and Health Insurance Association (CLHIA) recently announced that as of January, 2017 life insurance companies in Canada will no longer request or use genetic testing information for new life insurance applications up to $250,000.
This change comes as the Canadian federal government considers legislation prohibiting the collection of genetic test results before providing consumers with goods or services, including a life insurance policy. Providers will be required to obtain written consent for such information.
CLHIA’s Stance on Genetic Testing and Life Insurance
Like many other organizations that have a vested interest in life insurance, the Canadian Life and Health Association (CLHIA) have taken a stance on genetic testing and its use within the life insurance industry.
Specifically, CLHIA has argued that in cases in which insurance applicants have had a genetic test that reveals a predisposition to various diseases, insurers need access to that data to properly assess the risk factors of the applicant. CHLIA says, “If the bill is passed, the result would be less predictable claims experiences and higher prices for all consumers.”
However, if an applicant has had genetic testing and has access to the results, it is reasonable for an insurer to request this information. Just like with any other health records and medical history, it is reasonable for insurance companies to request genetic testing information, if available. Applicants are expected to provide full disclosure about their medical history when applying for coverage and should provide genetic testing information as a sign of good faith.
Full disclosure is required in order for insurance companies to properly assess risk and assign policies. The CLHIA states, “Insurance is a good faith agreement. At the time of application, parties disclose any information that may be material to the contract so that the contract can be entered into on an equal information basis. This ensures that the applicant knows what benefits are being promised and that the insurer can properly assess the risk so that the premium reflects the degree of risk assumed. This principle is reflected in insurance legislation in every province and territory and makes it fair to the entire pool of insured persons.”
The CLHIA goes on to state their stance on specific issues involving genetic testing and life insurance:
- All genetic information that is collected by insurers should only be used for risk assessment purposes and nothing else.
- Genetic information is only collected by insurers with the consent of the applicant.
- Genetic information collected will not be used for any unauthorized purposes. Applicant’s privacy will be upheld in accordance with provincial laws.
- Insurers, while they do not use genetic information without consent, have used the information that is genetic in nature that has been discovered when accessing applicant medical records in the risk assessment process.
Other Factors to Consider About Genetic Testing
There are a number of additional factors and topics that are currently being debated when it comes to the discussion of using genetic testing information for risk assessment for life insurance policies. They include:
- Confidentiality: Personal privacy and confidentiality are key issues. How insurers use genetic information, and how they protect individual privacy by managing this information brings up questions about access, accessibility, and storage of applicants medical history and information.
- Discrimination: Discrimination and denial of coverage is something that could become a serious issue for Canadians. Hypothetically, you could be denied life insurance if your parents receive genetic testing and it is uncovered that they are prone to a specific disease, as you will likely be a carrier of the gene.
- Information derived from genetic research: As genetic testing evolves and new discoveries are made in this area, it is important for the insurance industry to assess how new information is being used. The information needs to be accurate, backed up by sound research, and insurers must not act hastily when interpreting this information and applying it to insurance policy applicants.
Genetic testing and life insurance is an interesting dynamic. While it can provide people with information about potential health risks and allow them to take proactive steps to prevent disease, it could also prevent them from being accepted for life insurance. To identify an effective solution to this issue, further investigation is necessary before more Canadians become involved with genetic testing.
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