When it came to life insurance for PLHIV the computer said 'no'. But as Lance Feeney reports, things have changed.
In the early days of the HIV epidemic, positive people were viewed by Australian companies providing life insurance products as completely uninsurable. If you had HIV you were routinely declined every type of life insurance without any further consideration. So began the stigmatisation of HIV in the Australian financial services market.
Life insurance has always been a service based upon balancing large amounts of statistical data with commercial opportunities. This is easily seen in the treatment of smokers who apply for life insurance. Smokers pay more for their insurance premiums than non-smokers. This is because large amounts of statistical data suggest that smokers are at a greater risk of disease and death. Life insurance companies seek to offset that risk through higher premiums.
But what happens when there is no statistical data available to make a commercial decision upon? And what happens when this lack of statistical data is about the health expectancies of people diagnosed with HIV? The result was a blanket refusal for all life insurance for people living with HIV. Not only that, once a person was formally declined they were obliged to declare on all future insurance applications that they had been previously refused cover on medical grounds. Failure to disclose the information would be deemed to have provided a false statement meaning claims could be voided.
In 1992, the Disability Discrimination Act made it unlawful to discriminate against people with disabilities. HIV was considered a disability in the Act. However, life insurance companies were provided a formal exemption. Therefore, it was not unlawful for them to discriminate on the grounds of disability “if the insurer could prove that the refusal was based upon actuarial or statistical data which it was reasonable for the insurance provider to rely upon; or where no such actuarial or statistical data was available and could not reasonably be obtained”. In other words, they could lawfully refuse to provide life insurance to PLHIV because the risk of death was too high.
The introduction of combination antiretroviral therapy in 1995/’96 turned around the course of HIV infection and positive people stopped dying. In 2003, The Lancet published what was to become actuarially significant research from the Swiss HIV Cohort Study (a large ongoing study of people with treated HIV in seven large Swiss hospitals). The study concluded that the death rate in people with successfully treated HIV compared favourably with the general population and was no higher than the death rate among people with cancer who were successfully treated – a group not routinely denied life insurance.
In the UK, Canada, New Zealand and South Africa, life insurance was now being offered to PLHIV . Despite the developments in HIV treatment and life expectancy, Australian life insurers remained reluctant to lift the blanket ban on PLHIV . Positive Life NSW, the HIV/AIDS Legal Centre, and others, advocated for the Australian life insurance industry to follow their international counterparts and accept that HIV was now a treatable chronic condition, and no longer a death sentence.
These days, some Australian insurance companies offer full policies for PLHIV . As with any pre-existing condition, they do require medical underwriting to assess your risk. Eligibility is dependent on age, treatment compliance, having a low or undetectable viral load, a CD4 count above 350, and no significant comorbidities.
As part of an application, the insurer will request a medical report from your doctor to confirm treatment and ongoing control of your condition. The insurer will also request a confidential lifestyle questionnaire to assess any additional lifestyle risks.
Not everyone has the same degree of risk to a life insurance company. For example, if you are 30 years old and in good health, you would generally be at a significantly lower risk of early death than someone who is 60 years of age with poorly managed health. While there are no certainties in life – a younger person can die earlier than an older person – life insurance is based on a general calculable risk.
Underwriting is the process whereby insurers assess individual risk and decide whether to accept an application, and on what conditions. They measure long-term patterns in large amounts of statistical data. In general terms, it is all about balancing different occupational and health-risk profiles and trying to measure the possible effect of a particular issue happening earlier than statistically expected. This is so the insurance company can balance any increased risk with an increase in the premiums to cover the risk.
Lance Feeney is the policy analyst at Positive Life NSW.