Deborah O'Neill (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I rise this evening to put some remarks on the record with regard to genetic testing. The Parliamentary Joint Committee on Corporations and Financial Services, of which I am deputy chair, is inquiring into the life insurance industry, and it has been quite concerning to hear evidence of insurers discriminating against those who undertake genetic testing. Certainly, it's a very live issue.

Life insurance is a risk-based industry, so life insurers need to be able to assess risk accurately for each applicant on the basis of what information is available to them. But life insurance also spreads risk across a pool of individuals. Currently, insurers can ask if an applicant has undertaken or is considering undertaking a genetic test. This information is then used by insurers to determine risk. Now, let's be clear: genetic testing does not mean somebody will develop a condition; it's about the likelihood of having that condition. Importantly, the point has been made many times in the course of this inquiry that the reliability of tests is somewhat varied.

Evidence presented to the committee indicates that if someone receives an adverse result based on a genetic test, insurers undertake a number of options. Perhaps they might charge a higher premium causing access issues by effectively pricing the applicant out of the market. Indeed, when that has occurred, we have heard evidence that that needs to be disclosed to the next insurer and the person then is unable to secure insurance from any source. The other option that we have heard is an exclusion of insurance cover for certain conditions, particularly issues that are common in the Australian population such as cancer. This is despite individuals being able to actually take practical and proactive steps to detect any early possible signs of cancer and to adjust their lifestyle. The other option, which is all too common, sadly, is the refusal of insurers to cover completely—no cover—leaving individuals and their families financially vulnerable.

If someone undertakes a genetic test, that's a good thing. It signals that they are taking proactive steps to better inform their health. It's a new technology that we need to engage with. Following getting the results, people tend to respond very vigilantly and take further steps to minimise their chance of developing a condition, or they take steps to ensure early detection is more likely. Given that reality of positive health response to genetic testing, why are individuals and their families left worried about their financial status and their financial situation following this sort of action?

Pricing risk is a fundamental and necessary dimension of life insurance, particularly to make sure that this is a long-time and sustainable industry, and I appreciate this. We all appreciate this. The value of proper insurance is a critical part of a stable economic life for Australians. The life insurance industry plays a critical role in the lives of everyday Australians. I particularly acknowledge the important role that group insurance inside superannuation is playing for what was, prior to that, a very uninsured Australian population. Life insurance must remain viable, but it also must serve its purpose. Risk is spread across an entire pool of individuals. We can't see that continue to reduce as people undertake testing. I don't accept that individuals and their families have to make decisions where they're trading off financial stability, which could be secured through life insurance, against their health, which could be better informed by genetic testing.

The way life insurers use the result of genetic testing also has an impact on the broader community through innovation and through research and development. Increasingly, I am hearing reports that people do not want to be part of trials that require genetic testing because of concerns this will adversely impact on their life insurance cover either through higher premiums or no cover at all. In fact, we heard evidence that indicated ethics boards at universities were now advising researchers that they need to let potential participants in their trials know that by participating in a genetic test there might be negative financial impacts for them and that they would need to go and see their financial adviser or check with their insurer. This is not a sustainable practice. Evidence presented to the committee indicated that in one study when people were asked the reason for them not participating in research, insurance concerns were the reason for over 50 per cent of all of the people who said no.

Just last week, a 7.30 program on Channel 2 brought this issue to light again. We saw a story of a young father taking reasonable steps to check whether he had a genetic mutation called Lynch syndrome, which carries an increased risk of bowel and other cancers. What happened to him was something familiar. He provided the results of his genetic test to an insurance company and he was refused life insurance for cancer. But this young father, because he is aware of his genetic mutation, has the regular check-ups and cautiously monitors his health in this way, thanks to the information provided by the genetic test. Doctors tell him that the risk of cancer that he actually has, according to the professionals, is the same as the rest of the population. He just has more information about it than somebody who hasn't had the test and isn't disclosing the information. This is a real and pressing problem that we need to deal with in this country. Sadly, this father continued to struggle to gain life insurance.

Similarly, we heard the story of a young woman who has a genetic mutation which increases her risk of breast and ovarian cancer. She was told she'd only get life insurance if she undertook preventive surgery to remove her breasts and ovaries. Some stressful months later she was finally insured.

This problem is not just restricted to adults; it's also a problem facing children. I have had correspondence from a family who've had a child diagnosed with autism. There is increasing opportunity for a test for developmental delay and there are proposals about gene deletion and duplication matters for research that should be able to be undertaken. Information is available, and I understand from the correspondence that I received that this is starting to impact on people in terms of exclusion from insurance. There are proposals to do broader tests to get a better dataset, but increasingly people are saying, 'It is too risky for my child to be a part of this trial because it will impact on their capacity to get insurance later in life.' We are talking about young children who are looking at a lifetime of not being able to get insurance simply because their parents are taking, on their behalf, positive health action to improve their wellbeing, prevent their illness and improve their quality of life.

In the future, genetic testing is only going to increase in frequency as genetic technology is becoming cheaper and developments are ensuring it is more advanced. It must always be remembered, though, that genetic tests vary in quality, and current interpretations of results can be the subject of intense debate amongst clinicians. As more and more people rightly undertake genetic testing for health reasons, the way in which life insurers use genetic testing is only going to grow in prominence. At the moment, the use of genetic testing for life insurance is self-regulated through the Financial Services Council's Life Insurance Code of Practice. The code currently does not pressure individuals to have genetic testing undertaken, and I think that's a good thing. Other countries, though, have seen this problem. Countries such as the UK and Canada have protected consumers by restricting or banning the use of genetic information for insurance altogether—with certain limits, varying from country to country.

The inquiry of the Parliamentary Joint Committee on Corporations and Financial Services into the life insurance industry is due to report to parliament soon, and we will make recommendations in due course. I look forward to recording these concerns of our time. It is important that we have this issue on the table so that people can take reasonable steps to check their health and not end up being locked out of insurance. We took evidence from Dr Simon Longstaff, the Executive Director of the Ethics Centre. He said at one stage of the committee public hearings: 'If you could get to the point where you had absolute certainty about the particular fate of a particular individual based on their genome, there would no longer be insurance in the sense that we understand it. All of the communal benefits that come from insurance would progressively be lost.' We are not at that point. We do not want to get to that point. But we need to manage the reality that those who take proactive steps to better health cannot continue to be locked out of the life insurance market and dissuaded from taking positive health action. There needs to be a sensible balance achieved for the benefit of Australians more broadly and for the industry as well.