Genetics and longevity: a potential threat or opportunity?

Mark van der Watt, Chief Executive Officer at Life Insurance Solutions, Momentum

People are living much longer than they were two or three decades ago as technology, medicines, healthcare and lifestyles in general, improve. At the recent Momentum Risk Summit, held at Sun City, Mark van der Watt, Chief Executive Officer at Life Insurance Solutions, Momentum, emphasised that longevity is a global phenomenon and also a worldwide trend.

Outnumbering the young

“People are living longer and longer, more people are living to 80, 90, and in time to 100, and we have to think of how this will impact financial planning,” he said.

Between 2015 and 2050, Van der Watt said the proportion of the world’s population over 60 will most probably doublefrom 12% to 22%.

He said that by 2020 the number of people aged 60 and over will outnumber the children younger than five years. “If people start living above 100 years this will really start to test the life insurance and retirement industries.”

The game has changed

The insurance gap, according to Van der Watt, is also something to think about. He said, for example, in the States 82% of consumers agree that most people need life insurance, yet just only 62% of people say they have some form of life insurance. While 40% who say they have life insurance think they do not have enough cover. This is something to be aware of in the South African market.

When we look at longevity we have come a long way. Van Der Watt said technology has already started to help predict diseases other than the traditional way of doing things.

“Modern medicine is changing the game of things and genes can now be altered. These are all the things that need to be considered because they will affect the insurance industry significantly,” he continued.

Altering processes

A new era in medicine has just begun. Critical illnesses, for example, are being affected by advances and developments in technology and medicines.

According to Dr Andreas Armuss, Senior Medical Consultant at Munich Re, genetics are an enabler for new types of medicines such as predictive, curative and palliative medicine. The enablers of predictive medicine are genetics, genomics and pharmacogenomics.

Armuss also mentioned that drugs known as targeted therapy help stop diseases such as cancer from growing and spreading. They work by targeting specific genes or proteins.

Genetic testing is a type of medical test that identifies changes in chromosomes, genes or proteins. The results of a genetic test can confirm or rule out a suspected genetic condition or help determine a person's chance of developing or passing on a genetic disorder.        

Pharmacogenomics is also a kind of genetic testing. It looks for small variations within genes. These variations may affect whether the genes can activate or deactivate specific drugs. These test results can help the doctor choose the safest and most effective drug and dose.

There are also genetic markers potentially able to predict which cancers are more likely to become aggressive within the next ten years. Active surveillance, for example, may be a strategy to monitor men with prostate cancer thought to be at low-risk for progression and will not likely do any harm for a long time.

“This means risk assessment in cancer could change fundamentally in the forthcoming years,” said Armuss.

“Gene therapy, still an experimental technique, which uses genes to treat or prevent disease, instead of using drugs or surgery, means that a mutated gene that causes a disease is being replaced with a healthy copy of the gene to help fight off a disease.”

Armuss asked, so what is available nowdays? “Precise risk estimation regarding monogenetic diseases, risk associations with multifactorial diseases, individualised drug therapy improving prognosis, determining prognosis on genetic setup of cancers and improving prognosis of diseases significantly.”

What does this mean for the industry?

Armuss said sales agents may, in a couple of years and in the (far) future hear, “I have done a genetic test over the internet, and I suffer from a BRCA1 mutation. I heard there are critical illness products just covering cancer. Is that true?” “I have income protection cover for five years, but now I found out, that my risk for mental disorders, multiple sclerosis and cancer is very low. Can I cancel my expensive income protection insurance and, by the way, do you sell accidental covers?” “Thanks for offering me this critical illness insurance. However, I will have a heart attack in 17.3 years and will come back to you in 15 years’ time.”

“In disharmony, the market for genetic self-testing is growing and the accuracy of these tests will improve. Individuals can make more informed decisions about their need for insurance protection (choice of products, lapsing, upgrading of policies etc.) and insurers will be unaware of this, due to an imbalance of knowledge. Risk assessment (underwriting) could also be based on completely new criteria than done nowadays,” said Armuss.

“In harmony, risk assessment will become more individualised and more disease specific as it is nowadays. Personalised medicine (genetics) will offer the chance for individualised products and will increase the insurability for applicants nowadays deemed uninsurable,” he concluded.

Editor’s Thoughts:
There is no doubt that genetics will offer potential to the insurance industry, but like many things there is a downside to it. However, instead of focusing on the downside we should focus on the positives this could bring to the industry and what lies ahead in terms of product and service offerings for intermediaries alike. Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts myra@fanews.co.za.