A simulation study for multifactorial genetic disorders to quantify the impact of polygenic risk scores on critical illness insurance

With advances in genetic research, the understanding of the genetic structure of disease and the ability to predict disease risk have been enhanced. Polygenic risk scores (PRS) have been developed to assess a person’s risk of developing any heritable disease. PRS has two primary utilities that make it particularly relevant for insurers: the ability to identify high-risk groups when using PRS independently or in combination with standard risk factors; and the ability to inform early interventions that may alter future morbidity and mortality. Using heart disease as a case study, a simulation-based model is designed that introduces polygenic risk scoring into the actuarial analysis framework and then quantifies the adverse selection due to information asymmetry introduced by PRS. Individual and parental disease liability as well as PRS were simulated under a liability threshold model. A series of validations were conducted to confirm the utility of our simulated data sets. We explored three scenarios describing how insurance applicants use their PRS results to guide their insurance purchasing decisions and calculated the increased premiums that insurers would need to change to counteract this. The accuracy of PRS has the most significant impact on premiums and the proportion of individuals who know their PRS also has a substantial impact.