Insurance Issues

The insurance industry is based on risk. It aims to offer a fair service based on the risk level of any applicant. Premiums are higher for many reasons, e.g. age, smoking etc but also for health – this will be based on someone’s current health and family history. When applying for insurance all questions need to be answered honestly, otherwise a claim will not be valid in the future. While insurers do ask about family history, there are rules in relation to asking about genetics.

Since 1997 the Association of British Insurers (ABI) have agreed certain (time limited) rules which insurance companies have to follow in relation to genetics and insurance. The period of time, while they have agreed to follow these rules, is called a moratorium. The moratorium is due for review in 2011. The key obligations of insurance companies during the moratorium are:

No insurer will request that an applicant undertake a genetic test in order to take out insurance

That, in relation to HD, they can only ask for a test result if you are applying for:

Life insurance in excess of £500,000

Critical illness in excess of £300,000

Income protection in excess of £30,000 per annum

Very few people wish to take out insurance at these high rates.

This means that people who have a family history of HD will have to pay higher premiums than someone who doesn’t have HD in the family. If someone has a positive test the rates will continue to be high but if they have a negative test they will be able to take out a new policy and benefit from the lower premiums).

In relation to mortgages, while it is recommended that people take out life cover when taking out a mortgage this is not usually a compulsory requirement.

More Info:

HDA Factsheet: Advice on Life Assurance, Pensions, Mortgages, etc

Association of British Insurers - specifically their booklet ‘Genetic tests and Insurance – What you need to know’