California Insurance License Exam Practice Test Practice Question
Which of the following statements is TRUE regarding insurers with admitted status in California?
Correct Answer: C
Rationale: Insurers with admitted status in California are prohibited from using race, color, religion, or national origin as factors in determining insurance rates, ensuring compliance with anti-discrimination laws.
Option A is incorrect because no exception form can permit the use of these discriminatory factors. Option B is misleading; insurers cannot lawfully use these characteristics to justify higher rates. Option D is also wrong, as while insurers can use actuarially sound factors, they must exclude any discriminatory criteria, adhering to regulations that promote fairness and equality in insurance practices.
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