The industry claims that testing is required to exclude inappropriate financial risks for health and life insurance. Yet evidence of crushing AIDS related claims has yet to appear. Insurers have several methods of minimizing the financial impact of the AIDS epidemic, and it is not clear that HIV-antibody testing is an effective one. The use of tests to deny life and health insurance to those at risk of AIDS will be costly, both in adding to individuals' fear and anxiety and in its effect on welfare, medicaid, and medicare budgets. It may also further discourage people from participating in public health testing programs. The industry's use of testing provides a further demonstration that the private life and health insurance system not only does not always fulfill the social role that is expected; its actions may cause untold anguish, adding to the stigmatization already experienced by many Americans. The question now is whether the insurance industry's response to the AIDS epidemic will lead the public to demand broader reforms in the manner in which we secure against loss of health or life. 44 references.