Indiana State Life and Health Insurance Practice Exam

An insurance company may not reject a prospective insured's life application on the basis of which of the following factors?

1. Hobbies

2. Weight

3. Gender

4. Medical History

The correct answer is: Gender

The correct choice is based on the principle of non-discrimination in insurance underwriting practices. Insurance companies must operate in compliance with various laws and regulations that prohibit discrimination based on certain protected characteristics. Gender falls under this category, as many jurisdictions, including Indiana, have regulations that prevent insurers from using gender as a basis for denying coverage or charging different premiums for life insurance policies. While factors like hobbies, weight, and medical history can be taken into account during the underwriting process because they may directly impact the risk associated with insuring an individual, gender cannot be used in such a manner. Insurers must ensure that they do not unfairly discriminate against individuals based solely on their gender, promoting equity in the provision of insurance services. This understanding is crucial for aspiring insurance professionals, as it illustrates the importance of adhering to ethical practices and legal standards in the industry, fostering a fair and inclusive approach to insurance coverage.