WASHINGTON — New legislation introduced in Congress would bar life insurance companies from denying coverage or otherwise discriminating against Americans based on their lawful past travel to Israel or any other country.
The “Life Insurance Anti-Discrimination in Travel Act” was introduced in the House earlier this month by Rep. Rahm Emanuel, an Illinois Democrat, in response to complaints that insurance companies were denying coverage to people who frequently travel to Israel, or charging them unusually high premiums for life insurance. The New York State Assembly and the Illinois state legislature are considering similar bills.
Among those denied coverage was Emanuel’s rabbi.
“It is outrageous that life insurance companies are holding a potential customer’s past travel history over his or her head,” Emanuel declared in a statement issued in March. The congressman’s office declined to identify the rabbi in question. “Obviously,” Emanuel said in his statement, “assessing risk should remain the core of the life insurance industry, but whether or not an applicant has visited a specific location, such as Israel or Turkey, is not a legitimate or reliable factor in determining future risk.”
But Jack Dolan, a spokesman for the American Council on Life Insurance, said that a person’s travel record is the only way for an insurer to assess the risk associated with his or her travel habits. “Past activity provides an insight to future activity,” he said. “If you traveled before, there is a probability that you will be traveling in the future.”
The insurance bill does not mention Israel, but states that “it shall be unlawful to deny any person life insurance coverage, or to make any distinction or otherwise discriminate in the issuance, cancellation, terms (including premium rates), or conditions of life insurance coverage, based upon the past lawful travel experiences of such person.”
The bill was co-sponsored by 17 Democratic members of the House, most of whom are Jewish. Congressional staffers said that no Republican expressed interest in co-sponsoring the legislation. However, sources familiar with the legislative process said that Republican support was not actively sought.
Israel is one of 27 countries for which the Department of State has issued a so-called “travel warning.” Among the other countries that have been signaled out for such advisories are Colombia, Haiti, Iran, Iraq, Lebanon, Libya, Yemen and territories under the control of the Palestinian Authority.
Dolan said that the insurance council rejects “any government intrusion into risk management” of the insurance industry. “We would not support any legislation that would limit our ability to underwrite based on sound actuarial principles or reasonably anticipated experiences,” Dolan said.
In practice, Dolan said, anyone who is denied insurance by one company would be able to shop around and easily find another company that would provide coverage.
“There are more than 1,300 life insurance companies, and they employ different underwriting practices,” Dolan said.
Dolan said that he doesn’t know how many companies use the Israel criterion to deny coverage or demand a higher premium. But, according to Emanuel’s office, at least nine major insurance companies have been identified by customers who say they were discriminated against based on travel to Israel.
Members of the life insurance council met with Emanuel’s aides earlier this month. Representatives of insurance companies are expected to meet with staffers of several of the bill’s co-sponsors after Congress returns from its April recess.
A congressional aide involved in the negotiations with the insurance industry said that the objective of the bill’s sponsors is to resolve the issue, preferably without resorting to legislation. Therefore, he said, hearings on the issue would be held only if attempts to reach an agreement with insurers fails.