AB 1798 forbids life and disability insurers, agents, and insurance-support organizations from soliciting, requesting, or using genetic information—including an individual’s full genome or genetic data obtained from direct‑to‑consumer (DTC) testing—in underwriting decisions, and it requires disclosure forms to explicitly exempt genetic characteristics from broad medical‑record authorizations. The bill also sets informed‑consent standards when insurers do request genetic testing, creates civil and misdemeanor penalties for improper disclosure of genetic test results, and tasks the Commissioner with standardized consent language.
The measure changes multiple Insurance Code sections and stages those changes so a set of prohibitions and protections take effect immediately under the amended articles and are reinserted as operative law on January 1, 2036. For insurers, regulators, and compliance teams, the bill tightens what data may be collected and used in life and disability underwriting and imposes new documentation, record‑handling, and penalty risks to manage.
At a Glance
What It Does
The bill bars life and disability insurers from canceling, limiting, denying, or otherwise making adverse underwriting decisions based on genetic tests or genetic information, and prohibits seeking an applicant’s full genome or genetic information obtained via DTC testing. It requires authorization forms to exclude genetic characteristics and directs the Commissioner to adopt standardized informed‑consent language for any insurer‑requested genetic testing.
Who It Affects
Life insurers, disability income insurers, agents, insurance‑support organizations that compile consumer reports, direct‑to‑consumer genetic test customers, health care providers holding genetic records, and the California Department of Insurance (for rule drafting and enforcement).
Why It Matters
AB 1798 extends explicit statutory protection for genetic privacy into life and disability insurance underwriting, limits a new data source (DTC genomics) insurers had been able to leverage, and creates specific compliance obligations and penalties that will require operational changes across underwriting, medical‑release processing, and vendor reporting.
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What This Bill Actually Does
AB 1798 restructures California’s rules on genetics and life/disability insurance into a two‑stage setup: it updates current Insurance Code sections to impose stricter limits on insurers now, and it inserts parallel statutory language that becomes operative on January 1, 2036, so the protections continue. The effect for applicants is straightforward: insurers may not rely on genetic tests or an applicant’s genetic information to make underwriting decisions for life or disability policies, and insurers may not ask applicants for full‑genome data or genetic results they obtained from DTC testing companies.
The bill tightens release forms by requiring that any authorization used in insurance transactions expressly exempt genetic characteristics, genetic tests, and test results from general medical‑record authorizations (with a narrow carve‑out when genetic records are necessary for payment of benefits or therapeutic care). Where an insurer nonetheless requests a genetic test, the insurer must obtain written informed consent describing the test purpose, uses, limitations, result‑notification procedures, and confidentiality protections; the Commissioner must adopt standardized disclosure language.
If an insurer requires a genetic test as a condition of eligibility, the insurer must pay for it.On information‑gathering, AB 1798 stops insurers and insurance‑support organizations from preparing or requesting investigative consumer reports that seek an individual’s full genome or genetic information originally requested or obtained from a DTC genetic testing company. The bill also bars underwriting actions that rely on full‑genome or DTC genetic data and forbids asking applicants whether they have taken genetic tests or what the results were.
At the same time, insurers retain the ability to access medical records in applications, but the statute makes clear they cannot consider genetic information contained in those records for underwriting.To discourage misuse, the bill codifies penalties for improper disclosure of genetic test results: negligent disclosure carries civil penalties, willful disclosure increases those penalties, and disclosures that cause economic, bodily, or emotional harm can trigger misdemeanor liability, fines, and possible jail time. The measure also confirms that these provisions are the exclusive rules governing insurers’ use of genetic characteristics for life and disability underwriting under the named article, aiming to centralize and preempt conflicting requirements.
The Five Things You Need to Know
Disclosure forms used in insurance transactions must expressly exempt genetic characteristics, genetic tests, and genetic test results from general medical‑record authorizations, except when genetic records are necessary for payment or therapeutic purposes.
An insurance institution, agent, or insurance‑support organization may not prepare or request an investigative consumer report that seeks an individual’s full genome or genetic information originally requested by or obtained from a direct‑to‑consumer genetic testing company.
A life or disability insurer may not ask an applicant whether they have taken a genetic test, may not ask for test results, and may not base adverse underwriting decisions on a person’s full genome or DTC‑sourced genetic information.
If an insurer requests a genetic characteristic test, it must obtain written informed consent detailing purpose, uses, limitations, result notification, and confidentiality; the Commissioner must adopt standardized consent language, and the insurer must pay for any genetic test it requires.
The bill creates civil penalties for negligent (up to $1,000) and willful (up to $5,000) unauthorized disclosures of genetic test results, and makes disclosures that cause harm a misdemeanor punishable by up to one year in county jail and fines up to $10,000; each unlawful disclosure is a separate actionable offense.
Section-by-Section Breakdown
Every bill we cover gets an analysis of its key sections.
Mandatory exemption of genetic data from general medical‑record authorizations
The amendment requires that the standard authorization form used in insurance transactions explicitly exclude genetic characteristics, genetic tests, and genetic test results from broad authorizations for medical records. Practically, carriers and agents must revise release templates and intake workflows so genetic material is never swept into a general release—unless the release is narrowly for payment or therapeutic reasons. This shifts the administrative burden: providers and insurers will need clear procedures to segment genetic records or obtain a separate, specific authorization when genetic records are legitimately required.
Limits on investigative consumer reports seeking genomic data
The bill bars insurers and insurance‑support organizations from preparing or requesting investigative consumer reports that seek an individual’s full genome or genetic information obtained from DTC companies. Insurers must still advise applicants of the right to a personal interview if an investigative report is prepared, but they cannot use these reports to obtain genomic sequences or DTC results. This provision targets a particular data pathway—third‑party investigative products—and forces underwriters to rely on traditional, permitted sources rather than expansive genomic databases.
Prohibitions on seeking/using prior genomic or DTC information in underwriting
The statutes are amended to make it unlawful to seek an applicant’s full genome or DTC genetic information during an insurance transaction and to forbid basing an adverse underwriting decision on such information. The text preserves limited mechanics for sharing non‑genetic 'further information' among insurers (e.g., when a prior insurer furnishes additional underwriting facts), but those exchange rules do not open the door to genomic use. Compliance teams will need to audit data intake fields and vendor feeds to ensure no legacy processes request DTC or full‑genome data.
Statement of purposes and exclusivity; staged operative dates
The bill restates the article’s goals—preventing unfair discrimination based on genetic characteristics, establishing minimum standards for reliability, requiring confidentiality, and mandating informed consent—and declares the article (with cross‑references) the exclusive framework for insurer practices on genetic tests. The statute is implemented in a two‑stage fashion: an amended version remains effective immediately but is set to expire January 1, 2036, and a superseding version becomes operative on January 1, 2036. That construction appears designed to ensure continuity of rules while allowing the Legislature to revisit or update the framework before 2036.
Narrowed definitions of genetic characteristics and genetic testing
The bill defines 'genetic characteristics' as identifiable genes or chromosomal alterations that are known causes of disease or are associated with a statistically increased risk and are asymptomatic at testing. It also clarifies that routine exams or standard blood/urine tests aren't 'genetic testing' unless conducted to obtain genetic information. These definitions constrain the statute to predictive or presymptomatic genetic data rather than all biomarker or routine clinical information, creating a bright‑line that underwriters and medical record reviewers will need to apply.
Ban on underwriting using genetic tests, consent requirement, insurer‑paid testing
This core provision prohibits cancelling, limiting, denying coverage, or setting premiums based on genetic test results, and bars asking applicants about tests they took or their results. Where an insurer requests genetic testing, the bill requires written informed consent that describes the test, its uses and limits, notification procedures, and confidentiality guarantees; the Commissioner must adopt standardized language. The statute also requires the insurer to bear the cost of any genetic test it mandates. Operationally, underwriters must eliminate genetic data from decisioning algorithms and document consent processes when testing occurs.
Underwriting subject to article rules; penalties for improper disclosure
All underwriting activities concerning genetic characteristics are expressly subject to Article 6.6’s rules, and insurers may not require genetic tests when results would be used to determine eligibility for health plan coverage. The disclosure section establishes tiered penalties: civil fines for negligent or willful disclosures and misdemeanor exposure (including jail and fines) for disclosures that cause harm, plus liability for actual damages. The combination of statutory sanctions and a private‑liability route gives policyholders both deterrents and a remedy for misuse of genetic test results.
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Explore Finance in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Life and disability insurance applicants who have undergone or may undergo genetic testing — they gain statutory protection against underwriting actions based on their genetic information and against insurers asking about DTC test results.
- Consumers who use direct‑to‑consumer genetic testing — the bill blocks insurers and investigative report vendors from seeking or using those DTC results or an individual’s full genome in underwriting.
- Health care providers and medical record custodians — clearer limits on what insurers can authorize for disclosure reduce the risk that genetic data will be swept into broad releases and improve patient privacy controls.
- Privacy and patient‑advocacy organizations — the statute provides enforceable penalties and an explicit statutory framework for genetic privacy within insurance transactions.
Who Bears the Cost
- Life and disability insurers — they must retool underwriting models, remove genetic inputs, update forms and vendor contracts, train staff, and potentially absorb test costs when tests are insurer‑required.
- Insurance agents and brokers — they must revise disclosure and authorization templates, implement new intake procedures to avoid improper requests for genetic data, and face compliance oversight.
- Insurance‑support organizations and investigative report vendors — they may lose access to genomic data streams and must block or filter DTC/genomic information from their reports or risk liability.
- California Department of Insurance — the Commissioner must draft standardized consent language and will likely shoulder oversight, enforcement, and guidance duties without an appropriation in the bill text.
Key Issues
The Core Tension
The central dilemma is between protecting individuals from discrimination and preserving privacy for predictive genetic information, and the insurer’s legitimate need for accurate risk data to set actuarially sound premiums; the statute favors privacy and non‑use of genetic inputs, which reduces the data available to underwriters and forces insurers to rely on manifest disease and non‑genetic risk factors—potentially increasing uncertainty and shifting how risk is priced.
AB 1798 tightens genetic privacy in underwriting but leaves several operational and legal questions unresolved. First, the bill prohibits seeking an individual’s 'full genome' and genetic information 'originally requested by' the individual from a DTC company, but it does not fully define the contours of 'full genome' versus partial panels or derived risk scores.
Vendors commonly compute polygenic risk scores and share interpreted results rather than raw sequences; it is unclear whether interpreted results fall inside the ban. That ambiguity will generate litigation risk and require regulatory guidance to prevent inconsistent compliance across carriers and data vendors.
Second, the statutory rule that insurers may access medical records but must not 'consider' genetic information creates a practical filtering problem. Medical records often integrate genetic findings with broader clinical notes; operationally separating genetic data will impose costs on providers and insurers and raise questions about what constitutes 'consideration' (e.g., if an underwriter knows of a diagnosis caused by a genetic variant, is that a permitted manifestation?).
Finally, the bill’s staged drafting—repealing or limiting some sections until January 1, 2036 while adding parallel provisions that become operative on that same date—helps ensure continuity but signals that the Legislature expects future reassessment. That staged approach avoids an abrupt expiration of protections but also leaves room for regulatory ambiguity during transitions.
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