Australia is divided on whether genetic testing for setting life insurance premiums is fair
Are you willing to pay more so others pay less?
Would you be happy to have a genetic test done if it meant you'd pay less for your life insurance? Australia is almost split down the middle on the topic, with 51% believing individually-set insurance premiums are fair, according to findings from the Financial Services Council (FSC).
The FSC survey also found that 61% of respondents are not willing to pay a higher premium so that others get subsidised cover. People over 55 and those earning under $50,000 are the groups most likely to say "I'm not prepared to subsidise other people's life insurance premiums". Almost three-fifths (57%) said that they are happy to get a genetic test if it's free under Medicare.
The almost positive attitude towards trading data for financial savings is not unheard of. In July of 2017, a finder.com.au survey found that 68% of Aussies are willing to hand over their data in return for cheaper private health insurance. We're seeing similar shifts in car insurance as well, with people installing telematics devices that track their driving behaviour in return for reduced premiums.
Genetic testing in life insurance moratorium
In October this year, the Financial Services Council announced that there will be a moratorium on life insurers denying people who've had genetic tests but don't want to share that information with their insurer starting 1 July 2019. Up until this decision, you were obliged to share any results from a genetic test with your life insurer or risk having your application or claim denied. The ban will last until 2024, with the FSC conducting a review in 2022.
And just in case you're worried you didn't inform your insurer of that Ancestry.com test when you got a policy, while this type of test is interesting for you on a personal level, it's not something your insurer would have required you to declare.
Compare your life insurance options online
- All grown up: Millennials lead the pack in life insurance
- Considering income protection? These new rules may affect you
- Why you should be thinking about income protection insurance now
- Super changes could catch millions of Australians unaware
- Ask Finder: Is insurance through my superannuation good enough?