Welfare Effects of Banning Genetic Information in the Life Insurance Market: The Case of BRCA1/2 Genes

Michael Hoy () and Julia Witt

Journal of Risk & Insurance, 2007, vol. 74, issue 3, pages 523-546

Abstract: We investigate whether regulations that ban insurance companies from access to individuals' genetic tests are likely to lead to substantial adverse selection costs for the specific example of the so-called breast cancer (BRCA1/2) genes. Using a data set including economic, demographic, and relevant family background information to simulate the market for 10-year term life insurance, we find generally only modest adverse selection costs associated with such a regulatory ban. However, for family background groups that are at high risk for carrying one of these genes, the efficiency cost of adverse selection may be significant should the test become widely adopted. Copyright The Journal of Risk and Insurance, 2007.

Date: 2007

Downloads: (external link)
http://www.blackwell-synergy.com/doi/abs/10.1111/j.1539-6975.2007.00223.x link to full text (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Welfare Effects of Banning Genetic Information in the Life Insurance Market: The Case of BRCA1/2 Genes (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:bla:jrinsu:v:74:y:2007:i:3:p:523-546

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0022-4367

Access Statistics for this article

Journal of Risk & Insurance is edited by Georges Dionne

More articles in Journal of Risk & Insurance from The American Risk and Insurance Association
Series data maintained by Christopher F. Baum ().