Genetic testing evokes equal parts fascination and hesitation among many policyholders.
By decoding DNA, insurers could improve wellness and longevity, but the practice of testing the human genome also stirs concerns about information privacy and misuse.
How can the life insurance industry harness the power of genetics to develop products and services that support longer, healthier lives, while also respecting consumer concerns and regulatory constraints? The answer may depend on whom you ask. RGA conducted a survey globally in 2020 into January 2021 and collected responses from 30 major life and health insurers on the use of genetics initiatives as part of insurance propositions to existing policyholders.
A first survey of its kind, RGA’s investigation spanned multiple markets across the Asia-Pacific region, Europe, the Middle East and Africa, the U.S. and Canada, and Latin America. RGA sat down with survey organizer Carmela Tedesco, Vice President, RGAX Americas Business Initiatives, to discuss surprising commonalities and counterintuitive insights that emerged.
Q: Proponents argue that genetic-based insights from screening could promote healthier lifestyle and improved health outcomes through customized care. Critics, though, believe that direct-to-consumer testing is overhyped. How do insurers view this emerging field?
I think we can all agree that there has been an absolute explosion in direct-to-consumer genetic testing. This technology is real, easily accessible, and affordable in many cases. The question becomes how the science can inform insurance wellness products and services. While the current use of genetics-based tools and products is relatively low due to the regulatory landscape within many regions, this gap may stem from a misunderstanding. Insurers are primarily looking at genetics, not for underwriting assessment, but to better support existing policyholders in living longer and healthier lives. It’s important to make that clear, and our survey suggests that most insurers see two ways to do so: through improved health outcomes and better customer engagement.
Q: Explain what you mean by that. How can genetics improve health outcomes?
Most insurers saw potential in genetics with wellness – not underwriting. Insurers in our survey reported looking at precision medicine and nutrition, or the use of genetic insights to help proactively identify and manage mental and physical impairments and better customize medical treatments or dietary solutions. Keeping the insured population healthier and improving the prediction, treatment, and management of chronic diseases could yield significant long-term cost savings and healthier lives.
Genetic testing can also help reduce wasteful or ineffective prescription drug use. For example, the field of pharmacogenomics relies on genetic screening to determine the most effective drugs for treating chronic illnesses or pain and to avoid adverse drug reactions, which cost insurers billions of dollars annually around the world. Physicians can match drugs and therapies with genetic profiles, thus ensuring the most effective combinations and dosages for drug treatment.
The use of genetic testing falls into a broader trend in insurance medicine, which is to look for ways to develop a more holistic view of human health in order to better identify and address risks among current policyholders. After all, insurers, policyholders and healthcare providers all share the same goal: to increase longevity and quality of life.
Q: So, where does customer engagement come in, if this is all about improving health outcomes?
Information without action is meaningless. So, yes, genetic insights can be used to motivate a healthy lifestyle, but this only works when the policyholder is engaged. Too often insurers’ only point of contact with a policyholder after the sale comes at claims time, but the use of genetics to motivate a healthier lifestyle could provide an opportunity to build more of a relationship by identifying personalized wellness services and products built around genetic insights. This information could serve as a policyholder benefit and a selling point. What’s more, ongoing diagnostics could reduce overall claims and contribute to more effective disability claims management.
Q: These advantages don’t come without investment on the part of the insurer. Are carriers pursuing genetics-based products or services?
Yes and no. Only 13% currently have a focus on genetics or have a genetics-related initiative underway. Another 20% reported having plans for a “low level of investment” for future allocation of resources or budget. But a full 63% of respondents indicated that they are not prepared enough, or at all, for increased use of genetic testing in their markets.
Geographic differences were also apparent. North American participants had much more clarity on growth areas, commonly mentioning a focus on genetics to support disease prevention and wellness. Insurers in the Europe, the Middle East and Africa tended to see genetic testing for personalized products and services. Asia Pacific insurers expressed greater concern about regulatory challenges and perceived testing solely in terms of preventing and managing disease, but also saw growth potential. Latin American participants, on the other hand, shared few plans to explore further.
Q: Clearly there is a disconnect. Most insurers in the survey see change coming, yet are failing to prepare for this new technology. What barriers are holding insurers back?
We need to change the perception that genetics is about anti-selection and focus on utilizing genetics to improve health outcomes for policyholders. Survey participants worried that the key role genetics will play in shaping the future of medicine is going unrecognized within their organizations because of misunderstandings about its potential. Many also noted that regulatory uncertainty leads to a lack of prioritization. Another barrier: customer perception. Insurers worried about what it would take to motivate customers to enroll in genetics-based programs that might require regular updates and touch points to deliver expected outcomes. The costs associated with genetics also presented a significant constraint, with survey participants reporting concerns that the science may be just too costly, inaccurate, or complex to be economical.
Yet despite these hurdles, participants saw genetics as something insurers can no longer afford to ignore. Affordable and widely available direct-to-consumer genetic testing is now part of daily life, and insurers need to see the future of genetics as health and well-being for their policyholders.