DNA And Long-Term-Care Insurance

Do you know your genome?

With the easy availability of personal genetic information through companies such as 23andMe, more and more people are discovering not just their ancestral histories but their own exact DNA makeup, including their likelihood of contracting certain illnesses.

While that may be good news for consumers, the implications for insurance carriers are not so clear. Foreknowledge of future health issues can be a double-edged sword, particularly in the long-term-care (LTC) insurance business.

“It seems likely that, in the future, genetic screening will be used to facilitate early interventions that could result in reducing or eliminating more dire health consequences,” says Kimberly Foss, a certified financial planner and founder of Empyrion Wealth Management in Roseville, Calif.

That’s the good news.

On the other hand, she adds, “If genetic screening becomes a routine part of insurance underwriting practices, it will likely lead to more denials of coverage or, at the very least, increased premiums for those deemed to be most at risk.”

The term is “genetic discrimination.” It was outlawed for health-insurance carriers in 2008’s Genetic Information Nondiscrimination Act, but that restriction does not apply to LTC insurance or, for that matter, life insurance. “There are cases on record of applicants for life insurance being declined for coverage because of the presence of the BRCA mutation,” says Foss, referring to the genetic marker associated with breast cancer.

So far, there are no known cases of genetic discrimination in LTC insurance. But that could change soon. “A few of the DNA data providers are already reaching out to LTC insurance carriers, suggesting they offer discounts for clients to get tested,” says Samantha Chow, a senior analyst at Aite Group, a Boston-based research and consulting firm for the financial-services industry. “So the engagement side of this is happening already.”

Chow acknowledges that many consumers are uneasy about what insurers may do with the information. But the carriers’ reasons might not be as nefarious as feared.