We all know well, life insurance is a legal contract between an insured and an insurer, where the insurance holder is promised to receive a designated sum of money upon the death of the insured person. These days, the life insurance industry in Australia is touching a new height with approximately $10b annual premiums in force. Looking at the growth prospects of this industry, Australian government has framed some policies for their citizens. Some of the important policies are enlisted below:
- In Australia, premiums for private health insurance are not based on a risk assessment of an applicant’s present or past health or their family history. Applicants simply choose the type of coverage they wish to purchase and are charged a set fee, regardless of age or health status a system known as ‘community rating’.
- As per the recent survey, Life shield focuses on the facts which has found; premiums are based on an assessment of the applicant’s future health risks according to their present and past health, any genetic information including family history or any genetic test result, as well as other risk factors such as smoking, dangerous hobbies, etc (the insurance is risk-rated i.e. underwritten).
- Life insurance products include cover for life, disability, trauma, business and bank loans.
- Under the law (Insurance Contracts Act 1984), an applicant for a life insurance product is required to disclose to the insurer any health or genetic information known to them that might impact on the insurance policy being applied for.
- One of the survey results by lifeshield.com.au presents that the industry standard covering collection of family history now states that you are only required to provide information (medical and genetic test results if known) about your living or deceased parents, brothers and sisters (first degree relatives).
- Insurance policies offered by life insurance companies in Australia are â€˜guaranteed renewable’: once the applicant has received acceptance of the policy in the mail, no further health or genetic information needs to be provided.
- The insurance premium and even the ability to obtain an insurance policy may vary between different companies depending on their calculation of the health risk as well as commercial factors. Applicants may wish to make applications to a range of companies at the same time; an insurance broker or agent may be helpful in this process.
- Applicant’s should involve their family doctor, medical or genetics specialist if necessary in negotiations with the insurance company and document any screening and prevention strategies, where applicable If the predictive genetic test result was received before securing insurance cover, the applicant is required to make the results available to the insurer. Where an applicant’s relative has had a predictive genetic test and the test result is known, disclosure of this information is required but not any other personally identifying information, such as the relative’s name or contact details.
- An insurance policy may be secured before having genetic testing and the premium charged will be based on the information disclosed to the insurer, including the family history.
- Some insurers ask whether it is the applicant’s intention to undergo a genetic test in future. Where it is intended, this will usually result in the insurer postponing the application until the test is performed and the result known. The result will then be used by the insurer in the underwriting of the risk. Importantly, an intention to seek genetic counseling, or having had genetic counseling, is not an intention to have a genetic test.
- If a blood sample for a predictive genetic test has been given, but the sample has not yet been analyzed by the laboratory, the person may withdraw from the testing. While this information should be disclosed, the insurer should underwrite the risk on the basis of the family history and other respective disclosures made in the application. The insurer may request a statement to clarify that there is no immediate intention to request the result of the disclosed genetic test. Similarly, if a person provides a sample for the DNA to be stored for future testing (DNA banking), then they have not yet undergone a genetic test. If the laboratory has analyzed the sample and a result is pending, the insurance company may delay assessing the application until the result is available.
- Research Projects: The life insurance industry does not want to see potential research impeded by an individual’s fears that their participation may have an adverse impact in obtaining future life insurance. As always, full disclosure of any genetic test undertaken in any context needs to be made in an application. However, if a personal result will not be provided from the project, which means that you will not have anything to disclose relevant to your risk, the insurer will not use the fact that you have had a genetic test in the assessment of your premium.
Dealing with insurance companies:
Life insurance industry carries out its role with an emphasis on the above mentioned points. Just like any other firm in any sector, www.lifeshield.com.au works through a definite set of objectives and regulations. While dealing with any insurance companies, one should take several points into consideration. Few of these points are mentioned below:
- Ensure any information provided by brokers or agents is in writing from the insurer.
- The complaint system provided by the insurance company or any other official process may be helpful if an applicant is concerned about how their application was assessed.
- Enlist the support of the family doctor, medical or genetics specialist with addressing these concerns.