DNA testing technology has the potential to be the greatest disrupter to protection that the industry has ever seen, according to one research consultancy firm.
Following FTAdviser’s latest in-depth look on at how technological innovation is driving protection insurance forward, Finance and Technology Research Centre’s director Ian McKenna explained he also has his eye firmly on the implications for DNA testing.
“A service that can tell you how ‘at-risk’ you are of developing certain health conditions could turn the protection industry on its head; it puts customers in a tremendous position of power.”
He mentioned services like 23andMe, which provide DNA testing for as little as £125, noting that the cost will only decrease as the technology develops and becomes more mainstream.
In the US the heath data part of the 23andMe testing kits were asked to cease trading by the US Food and Drug Administration, although they are still trading the ancestry and raw genetic data tests.
However, the UK’s Medicines and Healthcare Products Regulatory Agency recently approved them for sale here, with the caveat that no DNA test is 100 per cent reliable and people should take any test result questions to healthcare professionals.
The testing claims to report on over 100 health conditions and traits, including inherited conditions and genetic risk factors.
Mr McKenna stated: “If a protection provider is able to embed this type of technology into their underwriting process, they will, overnight, be streets ahead of the competition in better understanding risks and pricing accordingly.”
Martin Bamford, managing director at Informed Choice Financial Planning, recently reported his own experiences using the kit, commenting that such services will become more widespread as genetic research continues and more people take an active interest in their health and ancestry.
“This is obviously still in its infancy, but I think we will see DNA tests used to personalise products and services. I can export the raw data, so I think it’s just a matter of time before an insurer starts accepting that as a way to get premiums down.
“Some will inevitably get hung up on the privacy aspects and there are risks around disclosure and cover for insurance purposes, but I think on balance that this is a really positive development,” he added.
Jay Sales, innovation strategist at the largest vision care insurer in the world VSP Global, agreed that the data and insights generated by genomic testing have the potential for long-term benefits.
“This is particularly true when coupled with something like an eye test, which can detect health risk factors that are also picked up by the genomic test,” he stated, explaining that examples of these risk factors are heart-related diseases, diabetes, glaucoma, cholesterol and Alzheimer’s.
“When you combine the evaluation of health risks with the ability to monitor health through an eye exam, you have the potential to reduce healthcare costs and mitigate risks. This shifts healthcare from reactive to being proactive and preventive, reducing financial impacts.”