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Why the new moratorium on genetic test results in life insurance strikes the right balance – for nowALUCA NSW Professional Development Day – 16 October 2019

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FSC Genetic Test Result Moratorium - ALUCA PD Day | Andres Webersinke | 16 October 2019 2

8 October 2018


• Parkinson’s Disease• Late-onset Alzheimer’s Disease• Celiac Disease• Alpha-1 Antitrypsin Deficiency• Early-onset Primary Dystonia• Factor XI Deficiency• Gaucher Disease Type 1• Glucose-6-Phosphate Dehydrogenase Deficiency• Hereditary Haemochromatosis• Hereditary Thrombophilia

23andMe



23andMe includes BRCA test (3 of 1000 variants)



2018-2015 Breakthrough Technologies



• Gene Database on 500,000 Brits• Estimates for heritability of more than 2,400 different traits and disorders

- 350 statistically significant- ~700 at least nominally significant

• More than 400 research projects • Other biobanks

- Kadoorie (China), > 500,000 participants- All of Us (USA), > 1,000,000 participants

UK Biobank makes data available



Inexpensive and available (screening)


8 October 2018


Are conventional risk factors replaced?metaGRS: genomic risk factor for CAD


C-Index = measure of goodness of fit for binary outcomes in a logistic regression modelSource: Inouye, M. etal. J Am Coll Cardiol. 2018;72(16):1883-93.


• Genomics Health Futures Mission – A$500 m over 10 years

Australia invests!


Example: Australian Reproductive Carrier Screening Project

• 10,000 Australian couples will be screened before they conceive or in early pregnancy

• Test for more than 1,000 recessive and X-linked genetic conditions


1.9%

2.0%

2.3%

2.9%

6.0%

8.5%

9.5%

12%

55%

Fetal tissue

Pre-implantations

Carrier testing

Familial segregation/cascade

Population screening

Maternal blood screening

Therapy monitoring

Symptoms of genetic cancer

Symptoms of genetic disorder

For a genetic variant

46%

dito (but in context of

cancer)

10%

Maternal12%

Newborn bloodspot

26%

Other diagnostic

tests6%

1,181,923

Genetic Testing Activity in Australia7/2016 – 6/2017


Source: RCPA. Australian Health Genetics/Genomics Survey 2017. May 2019

No. of tests?

Proprietary and Confidential | © General Reinsurance CorporationFSC Genetic Test Result Moratorium - ALUCA PD Day | Andres Webersinke | 16 October 2019 11

AGENDA Let’s take a step back first

Political pressure

Responses to our moratorium

Outlook


• Historically- Voluntary- Pooling/Sharing of risks- Age-differentiated

• Mutuality rating and differentiation (risk classification)- Private contract- Evaluation of individual’s risk- Allocation to specific risk stratum- Differentiation (or discrimination) is

governed by anti-discrimination law

Life Insurance



• Questions are asked to elicit known risk-relevant information • Depending on age/sum assured band medical tests are requested

- To obtain more precise information- But also to identify unknown risk-relevant information

• Questions are asked and tests are requested to - Protect the risk pool against anti-selection and mis-statements

• Information, such as on hypertension, is being used to predict the risk and its likelihood of materialising

• Information gained from a genetic test is not any different

“The Right to Underwrite”



• Insurers will not initiate any genetic tests• Insurers may request that all existing genetic

test results be made available for risk classification

• Insurers will not use genetic tests as a basis of “preferred risk underwriting”

• 2002 National Inquiry into the Protection of Human Genetic Information concluded that new laws and practices should ensure that genetic information is only used in a scientifically reliable and actuarially sound manner

The first Genetic Testing Policy



• Under no circumstances will an applicant be asked to undergo a genetic test

• May ask to provide existing test results for risk classification

• But not if the test result is not known to the applicant as part of a research study

• Test result not to be used for a second applicant

FSC Standard – pre moratorium



• FSC together with the Australian Genetic Non-Discrimination Working Group assess impact of a moratorium on use of predictive genetic information unless used for positive selection

• Life insurers be banned to use predictive genetic information until relevant FSC standards are updated

• After adoption of a moratorium Australian Government to consider legislation or regulatory banning or otherwise limiting use predictive genetic information in future

2018 Parliamentary Joint Commission Report



• “Once you have a result that indicates risk of disease, the life insurance company may use this against you, even if the scientific evidence isn’t solid.”

Influential lobbyist



Australian Genetic Non-Discrimination Working Group


“Remove barriers for medical research; we want

to be as competitive as other countries in the

genetic space.”“We want a total ban of the

use of diagnostic and predictive genetic test

results, other than from a favourable result.” “We have evidence for 175

cases of insurance applications with issues.”


• Robust conclusions can be drawn for a number of mutations (e.g. Macdonald, A. S., & Yu, F. (2011). The impact of genetic information on the insurance industry: conclusions from the 'bottom-up' modelling programme. ASTIN Bulletin: The Journal of the IAA, 41(2), 343-376. DOI: 10.2143/AST.41.2.2136981)

- Also supporting a positive underwriting decision in case of a confirmatory negative genetic test result

• 7,000 rare diseases are assessed according to underwriting principles and DDA (beyond data)

• Competition forces best decision• Newer research provides evidence

Life insurance policies have been declined or premiums loaded without adequate supporting data or justification.Genetic data is different and should be treated differently to other types of medical information (lack of data, privacy).

Lack of data to differentiate appropriately


S46 of the Disability Discrimination Act 1992 (DDA) allows differentiation if this is based upon

- actuarial or statistical data on which it is reasonable …to rely; and

- is reasonable having regard to the matter of the data and other relevant factors;

or

- …where no such …data is available and cannot reasonably be obtained—the discrimination is reasonable having regard to any other relevant factors.


• Based on small sample size and different participation characteristics (gender, previous cancer hx, etc.)

• “Those who tested positive were 5.76 times more likely to have altered their LTCI than those who did not receive APOE genotype disclosure.” (Zick, C. D., et al. (2005). Genetic testing for Alzheimer’s Disease and its impact on insurance purchasing behavior. Health Affairs, 24(2), 483-490. DOI: 10.1377/hlthaff.24.2.483)

• No of LTC insurers reduced from 100 to 12 by 2015 (USA)

Number of individuals declining predictive genetic testing more than double after insurance was mentioned on consent form.

Insurance as deterrent to participate in research



• Independent modelling paper- Refers to 6 single-gene late-onset disorders - Suggests a maximum cost of 3% for adverse

selection- Based on

- Level premium (not stepped)- No policy lapses (reduces anti-selective

behaviour)- To age 60 (not whole of life)- UK with less default group cover (more selective

retail market in AUS due to default insurance within super)

- Level sum assured (not indexed)

• Local actuaries can’t ignore local report• 3% lower margin requires rate increases

The insurance industry claims that if genetic test results cannot be used, adverse selection by gene-positive applicants will lead to significant increase premiums for consumers.A report prepared for the Actuaries Institute 2017 Summit asserts that a ban will result in adverse selection but its claims are arguably based on a worst-case scenario.Independent modelling undertaken elsewhere indicates that a ban would not have a significant effect. (MacDonald A. The Actuarial Relevance of Genetic Information in the Life and Health Insurance Context. Ottawa: Office of the Privacy Commissioner (2011).)

Financial impact of a ban on genetic test information



• The insurance industry concurs with the positive value of predictive genetic testing for some individuals and the society in general

• The insurance industry wants to increase efforts to encourage the insured population (the majority of Australians) to utilise health screening programmes, predictive genetic testing when recommended and participation in medical research

For some individuals declining predictive genetic testing can mean missing out on information that could prompt life-saving measures.

Insurance as deterrent



• Life insurers in Australia encourage applicants with adverse family history to submit negative predictive genet test results, if available

Life insurance in Australia should consider the use of negative test results to counter family history.

Use of negative genetic test results



• Any legislation won’t keep up with the evolution of our understanding and current research

• Our understanding within the life insurance industry and experts we consult is continuously growing

• More data is being captured and emerging techniques allow better data mining

• Data released by biobanks will provide significant research results

Understanding of human genetic variation is still evolving, and the classification of most genetic variants is not yet supported by robust population data.

Moving target



• Australian life portfolios are different- Unlimited coverage (whole of life)- Mostly stepped premiums allowing

“healthy” lives to switch insurers- Opt-out indexation (often above CPI)

without ceiling- High proportion of living benefits

(trauma, disability) - Most Australian employees have

(multiple) default cover through superannuation schemes without underwriting

Internationally, many countries have instituted bans on the use of genetic test results by life insurers.

International comparison



• And could not wait for Code 2.0 to be finalised• Emotional content• Government was keen to have no implications on Group business• Government felt PJC made important findings but they are “just”

recommendations• The industry had to make a proposal

We had to act!



• It may have unforeseen and unintended consequence• Any “repair” would take too long to fix• The UK Moratorium is often referred to as the “second-best”

- Government and ABI worked together and agreed a concordat in 2001- Since 2018 it is called a code and is open-ended- Insurer does not require the applicant to have a predictive or diagnostic genetic test,

under any circumstances- Insurer will not ask for, or take into account the result of a predictive genetic test with

the only exception being- The application is for life insurance over £500,000; and - The applicant has a predictive genetic test for Huntington’s Disease

Legislation is best avoided



The AUD Limits – significantly above median cover held


• Stepped Premiums• Indexation

• Whole of Life• Basic cover through

default insurance• DDA applies


Genetic Test Activity (UK)


0

200

400

600

800

1000

1200

1400

1600

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

Huntington’s Disease

02000400060008000

1000012000140001600018000

2004

/05

2005

/06

2006

/07

2007

/08

2008

/09

2009

/10

2010

/11

2011

/12

2012

/13

2013

/14

2014

/15

2015

/16

Familial Breast/Ovarian CancerDiagn. Query

Confirmatory

Predictive

Source: ACGS Audit 2015-16


Responses



Senator Deborah O’Neill (Labor) on GT, 30 July 2019



• Matt Hancock, UK Secretary of State for Health and Social Care

• 40 years at time of recording• Promoting the potential of genomic

data to improve disease management in the NHS

• He used a Genomics plc analysis• Genomics plc has produced

polygenic risk scores for heart disease, breast cancer and 14 other diseases – all proprietary

UK Biobank



• It might be quiet for a while but the “right to underwrite” will be challenged going forward

• Familiarise yourself with the moratorium (both Underwriting and Claims)• Avoid mistakes

- When aggregating cover- When assessing a genetic test result – unfavourable or not- Apply highest privacy standards- Always discuss the matter with a subject matter expert (and reinsurer)

• Collect and submit data – the Standard will be reviewed in 3 years’ time• The Standard will become part of the Code

What next?



• Genetic test results are just as relevant (or irrelevant) as every other piece of information used for risk classification

• Researchers are concerned that genetic test results used in underwriting creates fears and deters participation in studies

• Government invests in genomics• The general public accepts the current medical tests for uw but is unsure what

genetic test results mean and how they could be used• It is best to offer a temporary moratorium, establish evidence for underwriting

purposes • Mistakes play into the hands of the lobbyists• Genetics will play an increasing role in risk classification

Summary



• Insurers start to differentiate by data collected from wearables• Will there be calls for a moratorium on using

- Heart rates- Sleeping patterns- Activity durations- Location- Etc.

• Risk classification will change and we will increasingly test the boundaries of what will be publicly acceptable

What about….?



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Proprietary Notice


The material contained in this presentation has been prepared solely for informational purposes by Gen Re. The material is based on sources believed to be reliable and/or from proprietary data developed by Gen Re, but we do not represent as to its accuracy, its completeness or its up-to-dateness. In particular, this information does not constitute legal advice and cannot serve as a substitute for such advice.The content of the presentation is copyrighted. Reproduction or transmission is only permitted with the prior consent of Gen Re.

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