The federal government’s plan to ban the use of genetic test results in life underwriting has the support of the industry and other stakeholders.

The Council of Australian Life Insurers has welcomed the decision, as have the medical and legal professions.

And Australian Lawyers Alliance national president Michelle James says the ban announced by Financial Services Minister Stephen Jones “is good news” for consumers.

At present, the life industry is self-regulated via a moratorium introduced in 2019 amid concerns that people would not undertake genetic testing for fear of negatively affecting their ability to obtain affordable life insurance.

The moratorium was extended indefinitely under changes to the industry’s code of practice in July last year.

However, it does not provide a blanket ban. For instance, the moratorium allows life insurers to request or use the results of a genetic test if the total lump sum death cover a person would have is more than $500,000.

“The life insurance industry’s partial, self-regulated moratorium on using genetic results has not sufficiently protected consumers, so this legislation banning insurers from using genetic testing results in life insurance underwriting is critical,” Ms James said.

“It is good news that an individual’s decision to have genetic testing no longer needs to consider the potential impact on their ability to obtain insurance.”

Australian Medical Association president Steve Robson says the planned policy change is “fantastic” news for consumers and the health system.

“We know that the fear of being denied insurance coverage has been a huge disincentive for Australians to have genetic testing when they need it,” he said.

Mr Jones announced the ban last week after Treasury finished a consultation earlier this year.

The consultation paper floated three options: no government intervention; legislating a total or partial ban; or legislating financial thresholds at which insurers cannot request or use adverse genetic test results in their underwriting.

Council of Australian Life Insurers CEO Christine Cupitt says the peak body has “long been clear about the need for strict regulation to ensure no one is deterred from taking a genetic test to proactively manage their health”.