Back to School, Back to Your Financial PlanDNA testing kits make it easy and convenient to learn about your DNA. With just a small sample of saliva, you can discover interesting facts about your ancestry and your genetic health risks. The downside, however, is that you might not be the only one to learn about your DNA.
Life insurance companies could demand to know about any genetic risks exposed in DNA tests, and this information could be used to deny coverage or require high premiums.
Key Takeaways
- The Genetic Information Nondiscrimination Act (GINA) protects against genetic discrimination by employers and health insurers only — it does not restrict life, disability, or long-term care insurers.
- A handful of states have passed their own genetic-discrimination protections for life insurance, and more states have added protections since GINA passed in 2008 — check your specific state’s current law.
- Life insurers can request medical records and, in some cases, ask directly whether you’ve taken a DNA test, then use a disclosed genetic risk to adjust rates or deny coverage.
- Withholding a known DNA test result on a life insurance application can itself be grounds for denial or a rate increase if the insurer later discovers it.
- Insurers view genetic testing as a potential source of adverse selection — people who learn of a health risk may be more likely to seek life insurance shortly afterward.
- There’s no universal right answer on whether to get a DNA test before applying for life insurance — it’s worth weighing the value of the health information against how it could affect future coverage.
The Law Protects Your Genetic Information – But Not in All Cases
Thanks to the Genetic Information Nondiscrimination Act of 2008 (GINA), Americans do have some protections against discrimination based on genetic information.
According to the National Human Genome Research Institute, this includes protection against discrimination from employers and health insurers – and that’s it. The law does not stop other insurers, including life, disability and long-term care insurers, from using genetic information to determine rates or coverage eligibility.
Depending on where you live, your state’s laws may grant you additional protections. State-level protections in this area have expanded since GINA passed — the ACLU has tracked a small number of states with specific life insurance protections, and more states have added or updated their laws since. Because this is an evolving, state-by-state patchwork, it’s worth checking your state’s current law directly or asking your broker rather than relying on a fixed list.
Withholding Information Can Lead to Denial of Coverage
When you apply for life insurance, you’re generally asked to disclose any pertinent health information, which can include your family’s history of medical problems. Life insurers can also request medical records, and if you’ve taken any DNA tests, this includes the results. In some cases, insurers may ask specifically about any DNA tests you’ve ever taken.
If you lie on your application – and this includes purposefully withholding information like test results – you could be denied coverage or forced to pay a higher premium when the insurer discovers the truth. In our experience, applicants are often surprised that a family history question can trigger the same scrutiny as an actual test result — insurers weigh both.
But disclosing the information can lead to denial, too. Fast Company reported on the case of a healthy 36-year-old woman who was denied life insurance coverage because she had a high risk of developing breast cancer, as determined by her family history and a genetic test that showed she had the BRCA 1 mutation.
Insurers Are Worried, Too
Genetic testing can also cause problems for insurers.
To see why, you just have to think about how a person might react to a DNA test that reveals a predisposition to a fatal disease. That person may try to take preventative measures. That person may also apply for life insurance.
As the Economist explains, this is leading many insurance underwriters to worry about adverse selection. As DNA testing becomes more common, an increasingly large proportion of insurance applicants will consist of people who have learned about a genetic risk and are trying to secure financial protections against it. This can throw off claims ratios, leading to financial problems for the insurers.
This is why insurers want access to everything applicants know – it enables more accurate and sustainable underwriting.
What Should Consumers Do?
There are no easy answers here. DNA tests can provide valuable information, but that information may be used against you. If you take a DNA test and it reveals a genetic risk, you may have a hard time getting life insurance later. When deciding whether or not to get tested, this possibility should be considered carefully.
Weighing a DNA Test Against Your Life Insurance Plans?
Need life insurance guidance before you decide? Heffernan Insurance can help you think through the timing — get a life insurance quote now, while your options are still fully open, or read more about why more people are securing life insurance protection early.
