An article in Stuff by Sophie Harris and Daniel Smith says kiwis should be ‘very concerned’ about genomic discrimination. NZ insurance companies are allowed to see the results of genetic tests, which has led to some people having difficulties getting cover for treatments related to results of their genetic tests. It could also be leading to reduced donations to fertility clinics as potential donors decide against donating because results of the required genetic tests can be used by insurers in underwriting decisions. International research also shows some people decline medial genetic testing and participation in genetic research because of fear of the impact on being able to obtain insurance cover.
A United States survey found 28% of participants declined genomic testing because of concerns about insurance discrimination, the New Zealand Medical Journal reported recently. But Australia and Canada are legislating to protect individuals from genetic discrimination by insurance companies. Canada, in 2017, introduced a complete ban on the use of genetic test results to discriminate, including for insurance and employment. The Australian life insurance industry, in 2019, introduced a five-year ban on the use of genetic tests in underwriting. New Zealand insurance companies have not followed suit.
Southern Cross chief sales and marketing officer Kerry Boielle said it did not add a pre-existing condition exclusion as a result of a genetic abnormality, and typically would not increase premiums or refuse to issue a policy based on that information. However, it may exclude any consultations, further tests, or treatment required in its policy as a result of an abnormality. Southern Cross said that in the past five years, 51 members had disclosed a genetic abnormality or mutation, and 51 people had exclusions applied to their policy as a result of genetic abnormalities.
The patient advocacy group AGenDA (Against Genetic Discrimination Aotearoa) is calling for a complete ban on the basis that genetic discrimination is a consumer protection issue and a human rights issue.
These articles all tend to overlook the impact on insurance and by implication the other consumers in the insured pool. Underwriting protects the other insured people from paying claims where the risk of claim is too high to be insured normally.
Insurers use medical information to price risk, of course, and it is not clear how this would be affected by a ban on the use of genetic test data. The use of health information by insurers in New Zealand is a protected form of discrimination provided it is based on sufficient statistical evidence. Information which an applicant knows, but which an insurer is not permitted to know, heightens an information asymmetry between applicant and insurer which exacerbates anti-selection. An applicant who knows they are more at-risk will seek out insurance, while applicants who know they are not at-risk may not seek insurance – skewing the insured pool and increasing costs for everyone insured. At extreme levels this can make insurance no longer affordable for the market at large or even threaten the viability of insurance markets. For this reason, the limits on the use of genetic testing have tended to be quite modest. For more information refer to this article by Australian Genomics on the Australian Financial Services Council moratorium on the use of genetic tests in life insurance.
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