One of the big questions that seem to be coming up more and more when folks like yourself are starting their way on their life insurance journeys is whether genetic testing can affect your life insurance premiums.
Logically, you’d think they would.
If you know your DNA contains genetic markers that make you more at risk of developing cancer or any hereditary illness, surely your life insurance provider would smack a big fat extra loading onto the normal price to protect themselves against anti-selection?
Anti-selection happens when someone takes out a life insurance policy, knowing their health risk is higher than the insurer’s premium. Underwriting avoids anti-selection by getting as much health information as possible from you before calculating your premium.
In a survey carried out by the insurer Swiss Re, they found that if someone took a genetic test that showed an increased health risk, they were four times more likely to buy life insurance.
Well, fortunately for you, if you have undergone genetic testing, they don’t, and they can’t add a loading to your policy.
Good news, right!?
Bet you weren’t expecting that when you stumbled onto this page.
I’m guessing you know that you have to disclose your family history when you apply for life insurance.
Well, now you do!
Let’s say, for example, your big sister Sarah got hit with the Big C. She survived, but it wasn’t a great experience for any of you, so you want to know if you’re at risk.
You decide to do a little genetic digging to determine whether you may have your sister’s same genetic risk factor.
A teeny genetic marker called the BRCA gene means the likelihood of you experiencing breast cancer increases:
Everyone has the BRCA1 and BRCA2 genes (BR Breast, CA Cancer), but sometimes these genes are faulty, leading to an increased risk of developing breast cancer. These faulty genes are called gene mutations. Before you freak out because of the faulty gene, please rest assured that most cancers develop through chance and your lifestyle, not your genetic makeup.
So that’s the science, but let’s get back to your life insurance application.
When applying for life insurance, you would have to disclose that Sarah was diagnosed with breast cancer.
But if your genetic testing results come back with a positive marker for breast cancer, you don’t have to tell your underwriter about it. In the name of medical privacy, you can take this info to your grave if you so wish.
So even though, genetically, you are at a slightly higher risk of getting breast cancer, you’ll pay the same as someone who either hasn’t been tested or has tested negative.
And guess what?
If you are an oversharer – there’s no shame; we all love to get to know each other – the insurance underwriter can’t use your positive result when assessing your application.
So why is this?
Well, we all have the Disability Act 2005 to thank.
This pretty sound piece of legislation prohibits the insurance companies from asking about genetic tests
So to go over it again. When you apply for life insurance, you must disclose a certain amount of personal information, such as:
And that’s just to name a few.
I’ll be straight with you here. Insurers are pretty damn thorough when it comes to how they calculate your life insurance premium.
They’ll ask for as much information as they can get away with, but any genetic testing results you have are a no-fly zone.
You won’t find a genetic testing question on a life insurance application, but you will find the following guidance:
However, it is important that you are aware that in accordance with the provisions of Part 4 of the Disability Act 2005
you should NOT disclose the result of any Genetic (DNA or RNA) test. Some medical conditions are genetic and can be
passed from generation to generation. Advances in medical science have made it possible in certain circumstances to take
a genetic test and to ascertain if a specific condition has been passed on. If you have had such a genetic test then you
should not disclose it.
And if you look hard enough, you will also spot this paragraph:
You must disclose if you are having treatment for, experiencing symptoms of, or having investigations (other than a genetic
test) for a genetic condition as well as disclosing all other conditions.
So let’s say you are undergoing a heart screening (a non-genetic test) for cardiomyopathy (a genetic condition). You must disclose this screening to the insurer.
On the other hand, if you had a genetic test to screen for cardiomyopathy, you wouldn’t have to disclose this screening.
It’s a tricky one to get your head around, so feel free to give me a shout if I haven’t explained that clearly enough.
So I’ll say it again for those at the back.
It doesn’t matter what size of a policy you have either. Even if you’re Richie Rich and your policy is worth many millions of dollars, you still don’t have to pass on those results.
Okay, okay. We’re almost there.
So now you know everything you need to know about genetic test results and whether they can affect your life insurance policy.
Look, genetic testing is still relatively new.
Some are reliable, and some are not.
It’s like the difference between one of the fancy pregnancy tests that spell out, word for word, whether you are in a motherly way or not, and those flimsy cheapo sticks you can buy in Mr Price.
Hopefully, you didn’t buy the yokes to stop the baby-making in Mr Price too. But, if you did, congratulations!
If you have had a genetic test and this article hasn’t answered your question, please schedule a callback here where we can have a chat.
Or if you read this article and thought
I like the cut of this man’s jib, he’s just the fellow to help protect my heirs in the event of my untimely demise
complete this questionnaire, old bean, and I’ll be back in a jiffy.
Thanks for reading
PS: If you have a friend who would find this article useful or even somewhat interesting, please share. TYVM!
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