Under California law (CIC Sections 10146 and 10147(b)), an insurer may not use which of the following to deny coverage or set the premium for life insurance?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
California law prohibits insurers from discriminating against an applicant on the basis of genetic characteristics, genetic test results, or genetic information, including family history that is based on genetic testing. The prohibitions are found at CIC Sections 10146 and 10147(b). Legitimate rating factors such as tobacco use, age, and the results of a standard medical examination remain available to underwriters. The law prevents insurers from using an applicant's genetic makeup as a basis to deny coverage or charge higher premiums. This protection reflects the public policy concern about genetic privacy and fairness in insurance.
Why the other options are wrong
- Tobacco use is a valid, observable risk factor that insurers may lawfully use in underwriting and pricing life insurance.
- Medical examination results are a standard and permissible underwriting tool used to evaluate current health.
- Age at issue is a fundamental rating factor for life insurance and is used to set premiums for all policies.
Memory hook
Your genes are off-limits in California underwriting, but your cigarettes, exam results, and age still count.