Genetic Testing and Insurance: The Case for Regulation

Abstract

There is currently a significant level of debate in Australia and other jurisdictions about the appropriateness of intervention in the private insurance market to regulate the use of genetic test information by insurers. Whilst the issue has arisen most directly with the emergence of genetic testing, concerns appear to be extending to the use of any predictive genetic information for risk assessment purposes. Indeed, questions are currently being raised about insurers' use of family history information which is a source of information insurers have historically always had access to. In response to concerns about the use of genetic information, in August 2000, the Commonwealth Government established an Inquiry into the Protection of Human Genetic Information to be jointly conducted by the Australian Law Reform Commission and the Australian Health Ethics Committee of the National Health and Medical Research Council. Pursuant to this Inquiry, a Discussion Paper has recently been released which contains proposals for reform, amongst other things, covering the circumstances in which insurers can use genetic test information (Australian Law Reform Commission, 2002). The aim of this paper is to look at some of the problems associated with insurers' reliance on genetic information for underwriting purposes and to present the case for regulation (although not necessarily through legislative means). The main source of contention in relation to insurers' use of genetic information appears to lie in the field of predictive genetic test information: that is, in the situation where the individual is asymptomatic and the testing indicates that he/she is predisposed to developing a genetically related disease in the future. Predominantly, this contention is caused by limitations of the predictive value of such tests — usually only indicating that a person is at increased risk of developing a genetic disease, there being no certainty about this issue. It should be made clear from the outset that the scope of this paper is limited to those forms of voluntary insurance for which underwriting on health grounds is undertaken, such as life insurance, sickness and critical illness insurance: in the Australian context at least, this does not include health insurance for which a system of community rating is statutorily mandated pursuant to the National Health Act 1953 (Cth). Further, it should be noted that the paper is written primarily from a legal perspective. Clearly, economic efficiency implications would also need to be fully considered by policy makers.