A California disability income insurer automatically denies every applicant who tests HIV-positive, without individual underwriting. Under CIC §799, this practice:
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
CIC §799(c)(1) directs the establishment of standards preventing life and disability income insurers from making or permitting unfair distinctions between individuals of the same class in underwriting disability income insurance for individuals living with HIV. Section 799(a)(6) states that people living with HIV should have the same opportunities as other individuals with chronic medical conditions to purchase disability income insurance. A blanket, automatic denial based solely on HIV status, without considering the individual's condition and treatment, is therefore an unfair distinction rather than legitimate individual underwriting. The applicant must be evaluated on the same basis as applicants with other manageable chronic conditions.
Why the other options are wrong
- B) CIC §799(a)(6) expressly recognizes that HIV is now managed like other chronic conditions and that individuals living with HIV should have the same opportunity to buy disability income insurance. A blanket denial contradicts that legislative finding.
- C) The benefit amount the applicant requests does not justify a blanket rule. CIC §799 bars unfair distinctions in underwriting for individuals living with HIV regardless of the amount of coverage sought.
- D) CIC §799 applies to life and disability income insurers generally. Nothing in the statute limits its protections to individual policies or exempts group disability underwriting from the prohibition on unfair distinctions.
Memory hook
No blanket denial for HIV; underwrite it like any chronic condition.