The Treasury is calling for submissions on ways of combatting genetic discrimination in the life insurance industry.
The federal government is considering banning the use of adverse genetic test results by life insurers after a review from Monash University highlighted significant gaps in government oversight and enforcement of the current industry-led moratorium.
In a consultation paper released earlier this month, Treasury have called for feedback from all interested parties on the use of genetic testing in life insurance underwriting and ways of strengthening regulation in the area to better protect consumers.
Options for regulatory intervention include a complete legislative ban on the use of adverse genetic testing results by insurers or legislating a financial limit below which insurers cannot request or use adverse genetic testing results in their underwriting.
An industry-wide moratorium restricting the use of adverse genetic test results by life insurers was introduced through the Financial Services Council, after a parliamentary committee revealed rampant genetic discrimination in the absence of any regulatory oversight.
However, it is only applicable to newly issued policies under certain financial limits until 2024 – for instance, claims for lump sum death cover greater than $500,000 despite the average sum for insured individual policies for this kind of cover sitting at around $714,000, according to data from the Australian Prudential Regulation Authority.
In addition, an independent review into the moratorium by Monash University researchers earlier this year uncovered numerous instances of non-compliance with the moratorium’s terms across multiple insurers since its introduction.
More than 90% of health professionals and 86% of researchers surveyed over the course of the review believed legislation was required to enforce compliance with the moratorium’s terms across the industry, as previously reported by Health Services Daily.
Christine Cupitt, CEO of the Council of Australian Life Insurers, told media that the industry had no desire to dissuade consumers from undertaking genetic testing to find out more about their health.
“Our industry certainly doesn’t want to dissuade people from taking genetic tests or participating in scientific research that gives them more information about their overall health,” Ms Cuppitt said.
“Genetic testing can help empower Australians to manage potential health risks in a preventative and personalised way.”
The full consultation paper, Use of genetic testing results in life insurance underwriting, is available on the Treasury’s website.
Submissions to the consultation process will close on 31 January 2024.
Do you have a story tip for us, or a topic you would like to see us cover? Contact the editor at firstname.lastname@example.org.