Genetic testing is one of the wondrous breakthroughs of medical science, giving doctors the opportunity to identify and treat diseases early and patients the information they need to prevent them altogether.
But there’s a big problem that has nothing to do with human health: the law currently allows Australian life insurance companies to access genetic test results and take them into account when setting premiums.
Even though a worrisome result generally just means that you’re at a higher risk for a certain disease, life insurance companies will price your premiums as if you’re definitely going to get that disease, or summarily decide not to insure you. And if you pay those inflated premiums for your policy your whole life and end up dying of something else, they won’t be reimbursing the extra premiums to your survivors.
The law currently allows Australian life insurance companies to access genetic test results
Health professionals have a duty to warn patients about the possible life insurance implications of taking these tests, and the consent forms also carry such warnings.
As a result, many people steer clear of genetic testing, and thereby run the risk of developing a life threatening disease that may have been caught early or prevented.
Use of genetic test results by insurers to be banned
All this is set to change, and it has been a long time coming. In 2018, a Joint Parliamentary Committee Inquiry recommended that Australia immediately ban the use of genetic test results in life insurance, a rule that’s been in effect (with some exceptions) in the UK since 2001.
The practice is also banned in Canada as well as many European countries. In the US, health insurers and employers are prohibited from using genetic information as part of the underwriting or hiring process.
In November this year, the federal government introduced legislation that would ban the use of genetic test results by life insurers in Australia once and for all. It’s expected to come into effect in mid 2026.
In a statement, Assistant Treasurer Daniel Mulino said the bill “supports medical practitioners to prevent, diagnose, treat and monitor a range of cancers, cancer predisposition syndromes and other heritable conditions”.
He added: “Some people aren’t getting tested because they’re concerned about the impacts of the results of those tests on the affordability and accessibility of life insurance”.
The bill “has broad support across the Parliament”, Mulino said.
The November announcement was the culmination of years of advocacy work by health professionals and other consumer advocates, who faced stiff headwinds from the insurance industry.
There were half-measures along the way. In 2019, the then peak body for the Australian life insurance industry, the Financial Services Council (FSC), forged a compromise, requiring people who applied for life insurance to disclose genetic test results only if the policies had death or permanent disability benefits of more than $500,000.
But this measure was entirely self-governing. No government agency was checking to see if insurers were following it. (A new peak body, the Council of Australian Life Insurers, was established in 2022.)
People are making decisions about genetic testing based on insurance fears, not health needs
Dr Jane Tiller, Monash University
In 2020, the federal government funded a project (called the A-GLIMMER project) to investigate whether this industry self-regulation was working. The final report of the project, published in June 2023, makes clear that the FSC partial ban was far from effective at putting a stop to genetic discrimination in life insurance.
The three-year investigation uncovered several troubling facts, chief among them that some life insurers were ignoring the industry-led partial ban (technically a moratorium) and that the lack of independent oversight meant that no one really knew how widespread the non-compliance was.
The lead investigator on the A-GLIMMER project, Dr Jane Tiller – an ethical, legal and social adviser in public health genomics at Monash University – has long been convinced that a total ban on life insurers’ access to genetic test results is the only answer.
Dr Jane Tiller has been on a 10-year mission to bring about a ban on the use of genetic test results by life insurers.
Health professionals and patients whose views were sought as part of the investigation overwhelmingly agreed.
“Many Australians have been afraid to have genetic testing that could save their lives, because of the potential financial implications of their genetic test results,” Tiller says.
“Life insurers can still legally use genetic test results to deny coverage, increase the cost of premiums or place conditions on cover. This means people are making decisions about genetic testing based on insurance fears, not health needs.”
“Choosing not to have genetic testing means people could miss out on critical health information and access to early intervention or prevention, which can be life-saving.”
Tiller, who has been campaigning against the use of genetic test results by Australian life insurance companies for the past ten years, says the prolonged pushback by insurers in Australia followed a well established pattern.
“Every time a new country embarks on this process, the local industry fights vigorously against it,” Tiller says.
“We certainly faced a lot of opposition in the early days, with the industry very strongly saying that this would have catastrophic implications, that it would impact consumers in bad ways because premiums would rise, that the life insurance industry would be unsustainable. These claims were made in other countries as well. So for the first several years, it was very hard to get any traction.”
The A-GLIMMER investigation put a fine point on what happens when profit motives get mixed up with medicine.
We heard reports of multiple insurers not complying with even their own moratorium
Dr Jane Tiller, Monash University
“In our research, we found two things,” Tiller says. “One is that people don’t trust insurance companies, and that’s very clear. People don’t trust them to use their data when that data is of benefit to the life insurer.”
“And we heard reports of multiple insurers not complying with even their own moratorium [on using genetic test results for policies with death benefits of $500,000 or less]. Brokers were telling us that the life insurers they worked with were very happily using whatever mechanism they could to get around that and not comply.”
Designing a study to measure the effect of avoiding genetic testing on long-term patient outcomes would be difficult at best, but Tiller says the substantial anecdotal evidence gathered through the A-GLIMMER project suggests people who avoid such tests face higher health risks.
The data on test avoidance itself is clearer.
“We know that there are many people who go to a genetic counselling appointment, are told about the insurance implications, and decide not to have testing. And we know that lots of people say they would never have genetic testing because of the insurance issue,” Tiller says.
Lots of people say they would never have genetic testing because of the insurance issue
Dr Jane Tiller, Monash University
She recounts a story recently told to her by a clinical geneticist of a patient who came in for genetic testing for a BRCA variant (which would indicate a seven-in-ten risk of breast cancer).
“She said, ‘I’m going to go away and think about it. I’m worried about this insurance issue’. When she came back a year later, it was because she’d been diagnosed with breast cancer. These kinds of stories happen all the time, and I’ve heard many of them.”
“I can only imagine the number of stories that I haven’t personally come across. They are discussed incessantly in community groups, in advocacy, organisations, in research. There’s a constant conversation about having to tell people about the life insurance issue and the fact that they go away and don’t come back.”
When patients are told their genetic test results will be made available to life insuers, many decide not to have the test.
Tiller is co-leader of a study called DNA Screen at Monash University, which aims to increase the uptake of genetic testing. For one project, 10,000 young people were tested for the risk of preventable cancer and heart disease.
“There is huge community interest in this kind of actionable genetic information,” Tiller says. “But lots of people dropped out along the way. And when we surveyed them, more than half said the reason they decided to drop out was because they learned about the insurance issue.”
“So we know it’s the biggest barrier and the biggest reason people don’t participate. And we know that this will eventually lead to high rates of cancer, of heart disease, and of other conditions that may have been prevented or treated earlier.”
The new law – should it pass – will be written into the Insurance Contracts Act, which is enforced by the Australian Securities and Investments Commission. It will also dictate an amendment to the Disability Discrimination Act, giving people the right to file a civil suit if it’s contravened.
Applying it to existing insurance contracts would have been the ideal outcome, but Tiller acknowledges there are tricky legal issues involved in applying new conditions to old contracts.
“It will only apply going forward to people who take out new insurance policies,” she says. “It won’t apply to people who have current policies that are discriminatory. And that’s something that we’ve always been concerned about. What about that group of people that won’t be helped?”
It won’t apply to people who have current policies that are discriminatory
Dr Jane Tiller, Monash University
Some genetic test results mean not just that you’re at higher risk but that you’re certain to develop the disease, such as those that reveal the gene variations linked to Huntington’s Disease.
“But we’re talking here more about tests that show that someone has a future risk of disease,” Tiller says.
“People walking around with these genetic variations have them whether they have the test or not. And so if they go and get insurance without having a test, that’ll actually be underwritten at standard rates. But they would then be at a higher risk that they’re not addressing.”
“If they have the genetic test, they’re able to take preventive steps. But until this law comes into place, they would then be subject to pricing discrimination because they took that proactive step.”
Tiller is confident that the bill will become law, and that a federal law is a lot better than relying on the industry to monitor itself.
If they have the genetic test, they’re able to take preventive steps
Dr Jane Tiller, Monash University
“I think that the legislative framework is robust enough that it will ensure that most insurers change their practices. It is a total ban. And that was something that we weren’t sure we would get in the early days.”
“Will it be able to be enforced is the real question, and that is always a challenge. But I think the more robust the regulation is, the more of a deterrent it creates. This is leaps and bounds better than what existed before.”
Andy Kollmorgen is the Investigations editor at CHOICE. He reports on a wide range of issues in the consumer marketplace, with a focus on financial harm to vulnerable people at the hands of corporations and businesses. Prior to CHOICE, Andy worked at the Australian Securities and Investments Commission (ASIC), and at the Australian Financial Review. Andy is a former member of the NSW Fair Trading Advisory Council. He has a Bachelor of Arts in English from New York University. LinkedIn
Andy Kollmorgen is the Investigations editor at CHOICE. He reports on a wide range of issues in the consumer marketplace, with a focus on financial harm to vulnerable people at the hands of corporations and businesses. Prior to CHOICE, Andy worked at the Australian Securities and Investments Commission (ASIC), and at the Australian Financial Review. Andy is a former member of the NSW Fair Trading Advisory Council. He has a Bachelor of Arts in English from New York University. LinkedIn
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