Blog: Genomics & Insurance: what does the rising tide of genetic data mean for insurance? by Sabine VanderLinden Click to Tweet
As genome sequencing is made available to everyone and the insights from the data is used to forecast, pre-empt and prevent health risks, what does all this mean for insurance customers and insurers alike?
In 2003, the human genome was mapped. It took 13 years and $3 billion. Today any human genome can be sequenced for $1,500 in 15 minutes. Click to Tweet
As this cost continues to drop, we’re likely to see genome sequencing for nearly everything, including unborn and newborn child. This gives us the ability to spot gene mutations that could lead to future illnesses and medical conditions.
With such new reality, we now face two significant questions: Who should be allowed to access such genetic information? And what could or should be done with it?
“When talking about life insurance, it’s going to be difficult to ignore genomic data. Your DNA is your medical future. It’s predictive of what’s likely to afflict or kill you.” Peter Diamandis
Promising means to identify health risks
Genetic information is one of the most promising means for addressing potential health risks and avoiding those all together. But leveraging such source of insight may also bring genetic discrimination. This is a central concern for individuals and the government.
Such scenarios are neither hypothetical nor do they sit in a far future reality. There are, already, companies using genetic information as part of the screening process for job applicants. And most countries do not have yet in place comprehensive regulations or rules to prevent institutions to use such information or ensure the secure usage of such information.
Before we delve into the future implications of genetic testing for business and technology, let’s look at what genetic information means to the basic concept of insured risk. Insurance is based on shared knowledge related to potential risks that have not yet happened. By assessing an individual’s health risks, an insurer can pool that individual with others at a similar risk level, or allow the worst risk types to be pooled with the best risk types to optimise price and future claims costs. This way, medical costs are equitably distributed throughout that specific risk pool. This system only works when both insurer and insured share the same information. When one side has additional information the other isn’t privy to, it’s a little like insider trading which puts one party at an advantage over the other.
We are today gaining access to an enormous volume and variety of data sets—individually and collectively—that can be used to evaluate health risk. While we attempt to use that data to improve people’s health and longevity, we will need to figure out a fair way to spread insurance risks across health groups where more genetic information is available, whilst not being unduly unfair.
These two things require a tricky balance.
Where are we today in terms of policy?
Current regulatory and ethical policies encourage a system “Where we are better off not knowing”. As long as neither the applicant nor the insurer is aware of any genetic abnormalities, there can be no discrimination based on the knowledge of pre-existing genetic information.
Two key questions come to mind: How can we keep this information secret and only use the relevant bits to save life? If we know of the existence of a piece of information which may potentially occur in the future should insurers have the right to request and use it?
“Genetic screening data could be misused, by those people who might gain benefits on the expense of those whose genetic screening results revealed that they are under risk of some diseases, it is important to ensure that if the application of any new technology leads to negative impacts on the members of the society, then this new technology will be unaccepted by the majority.” Human Genetic Screening, Firas M Abu-El Samem
There is a voluntary code set down by many national insurance associations. The United States has a specific federal law addressing the issue of genetic discrimination. France also prevents doctors from sharing that information and requires data providers to keep any illnesses and diseases secret. The Genetic Information Non-disclosure Act (GINA) prohibits employers from using genetic information for hiring or compensation purposes. It also prevents insurance companies from using genetic information when underwriting health insurance. This does not, however, apply to life, disability or long-term care insurance. Nor does it apply to banks that may wish to know genetic information before approving mortgages or loans.
The challenge ahead for business and technology.
The more genetic information we acquire, the greater ability we have to prevent or minimise long-term illnesses and live healthier lives. Insurers also benefit by being able to more accurately pool client premiums. And researchers can develop new medicines and treatments based on improved genetic information. But how do we take full advantage of this information without creating a system in which many people become uninsurable or afraid to undergo genetic testing?
The solution relies on a partnership between businesses, the government, genomic researchers and technological innovators. Breaking down or disintermediating the value chain and ensuring that key parties actually use the health information they hold within the constraints of data laws. We are only in the rudimentary stages of this cooperation. The challenge is finding new, innovative ways to manage and disseminate this rising tide of genetic data.
Startups in the genomic space
You have a great opportunity to help healthcare, life, long term care, disability and indemnity insurers. Please think of the ways you can drive the right level of transparency across the health and life insurance value chains, without making at risk customers uninsurable.