When you apply for life insurance, you have to give up a lot of private information. Not only do you have to give them your name, address, and Social Security Number, but you have to undergo a medical exam and drug test as well. This leads to a lot of anxiety among some shoppers — Will my life insurance company share the results of medical exam and drug test with my employer or my doctor?
First, let’s give you the short answer: you can trust your life insurance company with your drug test results. All life insurance companies and companies related to the collection of health data, including brokers (like PolicyGenius) and the medical examiners, have to comply with a federal law called HIPAA.
HIPAA stands for Health Insurance Portability and Accountability Act, and the most important thing you need to know about it is that it establishes standards for the protection of private health information. The biggest rule: no organizations can share your private health data without your explicit permission.
HIPAA violations do happen — most commonly with data leaks, but also sometimes as personal vendettas — but the fines levied against violators are steep, and violators can face both civil and criminal penalties.
Your drug test results fall under HIPAA protection, and if you test positive for a drug — marijuana, for example — it will not be shared with any third parties unless you give explicit permission.
This also applies to other results from your life insurance blood test or medical exam, including your weight, HIV status, and other kinds of sensitive information.
Your medical examiner will need permission to share your results with your life insurance company
Your medical examiner will require that you explicitly allow them to share information, however — medical examiners are usually contractors, and need your permission to share that information with your life insurance company. Your life insurance company will also request permission to share your data with the Medical Information Bureau, or MIB. This is all totally normal — they need to pass this information back and forth in order to come up with your final life insurance rates.
The MIB is a trade group that helps insurers share medical data. The purpose of the MIB is to make sure that people do not commit fraud on their insurance applications. For example, let's say you tested positive for marijuana use on your life insurance drug test. Without the MIB, you could potentially stop smoking marijuana for a month, take the drug test with a different insurer, and get life insurance without disclosing your drug use. With the MIB, this isn’t possible, as the results of the original drug test would be shared with the second insurance company.
The MIB only shares information with other insurers, and you need to give it permission to share data with your life insurance company during the application process. They do not share data with your doctor, employer, or family.
If this makes you uncomfortable, it will be difficult to find an alternative. If you don’t share your health data, you effectively cannot buy life insurance.
Almost all insurance companies are members of the MIB and will require your permission to share data. However, you can trust that under HIPAA, the MIB and your life insurance company are incentivized to keep your private information private.