Regulating Genetic Information in Insurance Markets

The debate on whether insurance companies should be allowed to use results of genetic tests for underwriting purposes is both lively and increasingly relevant as both technology and lawmaking efforts are progressing rapidly. In this article we outline the primary economic and non‐economic arguments made in favor of and against allowing insurers to risk‐rate premiums on the basis of genetic test results. While economic analysis has much to offer in enlightening this debate and informing policy makers, we argue that such work must be cast within the overall perspective of the genetic testing debate. Moreover, despite substantial strides by economists in understanding the role of information in the way insurance markets operate, much work still needs to be done in order for economic analysis to be confidently applied to the looming social issues of the continuing genetic revolution.