Risky Business: Genetic Discrimination & Insurance

Françoise Baylis discusses the response of the Canadian insurance industry to Bill S-201, An Act to prohibit and prevent genetic discrimination.

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Bill S-201, An Act to prohibit and prevent genetic discrimination, has received the unanimous support of the Canadian Senate. It is now before the House of Commons where it has received all-party support and passed second reading. It has been referred to Committee for review and improvements before the third and final reading.

In brief, there are three parts to the Act. First, there is a prohibition on “requiring an individual to undergo a genetic test or disclose the results of a genetic test as a condition of providing goods and services.” This would stop companies that sell life, critical illness and disability insurance from asking clients to take a genetic test or to share information about genetic tests they may have taken.

Second, there is a proposed change to the Canada Labour Code, namely, “to protect employees from being required to undergo or to disclose the results of a genetic test.” This would stop federally related industries from asking employees to take a genetic test or to share information about a genetic test they may have taken.

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Third, there is a proposed amendment to the Canadian Human Rights Act. This Act prohibits discrimination on a number of grounds including race, ethnic origin, sex, sexual orientation, and disability. The plan is to add “genetic characteristics” to this list.

Some people criticize Bill S-201 – most notably insurers. They worry about clients taking a genetic test, getting results that suggest an increased risk of developing a specific “genetic illness” and “bulking up” on insurance. They describe insurance as a “contract whereby there is equal knowledge by the person who is applying for the insurance and the insurance company”, and they believe that private genetic testing can give clients an unfair advantage.

First, the claim that the contracting parties have equal knowledge is false. At present, insurers have a clear informational advantage. Insurers not only have access to clients’ demographic information, health information, lifestyle information and family history, but they also have access to this same information from many similarly-situated clients. As well, they have the means to access and interpret the latest medical and scientific research, and they have considerable expertise in actuarial science (mathematical and statistical methods to assess risk).

The insurers’ informational advantage could change, however, if Bill S-201 becomes law. This points us to the second claim made by insurers that private genetic testing gives clients an unfair advantage.

If, in the future, clients are able to obtain genetic risk information and are able to keep this information private, at what point does their informational advantage overcome the insurance companies’ other informational advantages and become unfair? The answer to this question is likely very complicated for at least two reasons. First, the insurers will nonetheless still have access to some genetic information through family history. Second, the clients will have information on the basis of which to take preventive measures including accessing health care and making lifestyle changes.

Consider, for example, a woman with a family history of breast cancer. Whether she applies for insurance before or after genetic testing, the insurer will have access to her family history and will use this information in calculating insurance premiums.

Now, imagine that this woman has a genetic test confirming that she has the BRCA1 gene and that she does not disclose this information to her insurer. Does she have an unfair informational advantage? In thinking about this question, it is important to know that environmental toxins are statistically more likely to cause cancer – including breast cancer – than faulty genes. It is also important to consider the possibility that the woman who receives the genetic information will choose to have a preventive double mastectomy.

The point here is that “Our Genes ‘R not Us,” “Our DNA is not our destiny.” Environmental factors matter…  Personal choices matter… And, there is always luck.

If Bill S-201 becomes law, there is no doubt that this legislation will have an impact on the sale of life and health insurance. Most likely, insurers will change the way they do their calculations to account for additional uncertainty and this will result in increased premiums for everyone.

Canadians understand the concept of shared risk, in large measure this explains our public health care system. Insurers should not be encouraging us to think selfishly about keeping our premiums low by throwing some (who are perhaps at increased risk) overboard. In my view, this is what insurers are asking us to do when they speak against the proposed legislation while, at the same time, reminding us that failing to support their view will mean increased premiums for all of us.

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Françoise Baylis is a Professor and Canada Research Chair in Bioethics and Philosophy at Dalhousie University @FrancoiseBaylis

For more, listen to CBC The Current “Can genetic discrimination bill protect patients from insurance hikes?”