I promised myself that I wouldn't mention any New York Times articles in my next few blog entries -- not after mentioning the newspaper twice in recent posts -- but I couldn't help myself last week, after coming across an article headlined "Insurance Fears Lead Many to Shun DNA Tests."According to the article, some people are avoiding DNA tests that could indicate genetic predispositions to certain health problems because they fear that it could affect their health insurance coverage - under a form of "genetic discrimination"
from the New York Times:
Such discrimination appears to be rare; even proponents of federal legislation that would outlaw it can cite few examples of it. But thousands of people accustomed to a health insurance system in which known risks carry financial penalties are drawing their own conclusions about how a genetic predisposition to disease is likely to be regarded.
As a result, the ability to more effectively prevent and treat genetic disease is faltering even as the means to identify risks people are born with are improving.
While the implications of this news has obvious implications for health insurers, I wonder if, in a way, this strange phenomenon could foreshadow what lies ahead for other parts of the insurance industry.
In late 2007, I had a conversation with Chad Hersh, a senior analyst in Celent's insurance practice. We discussed what the future of insurance technology could entail, such as increased and continued use of predictive analytics and mobile technologies. When it came time to discuss the slightly more distant future, the conversation shifted to "smart dust," which Hersh described as tiny sensors, built into a home or building, that communicate with one another to monitor things like the structural soundness of a property and communicate that info to a property owner or insurer.
The practical application of such a technology is obvious. Maybe we could anticipate bridge or building collapses. Perhaps we could identify if a given property was more susceptible to wind damage than another. In a similar way, GPS devices could monitor driving habits -- giving the general public (and, of course, underwriters) a better idea of how safe a specific driver is.
The key though, will be how the general public perceives these advances. Some will no doubt embrace these technologies and view them as an opportunity for reduced insurance rates, not to mention safer building and roads. However, I expect -- based on the distrust many in the public have for insurers -- more could view these advancements as invasions of privacy: one more way for those no-good carriers to justify a rate increase.
If this recent DNA-related news has taught us anything, it's that consumers are wary of the new technologies that insurers will use - even those that can make a direct positive impact on their overall well-being.