State RegulationsNY specificDifficulty 1/5
Under N.Y. Ins. Law §§2606 through 2608, charging applicants of the same class and equal risk different premium rates for the same coverage is:
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under N.Y. Ins. Law §§2606 through 2608, making or permitting unreasonable distinctions between individuals of the same class and equal hazard — in premium rates, dividends, or policy values — is unfair discrimination. Rate differences are lawful only when grounded in real differences in risk, such as health, occupation, or habits.
Why the other options are wrong
- A) Consent cannot legalize a discriminatory rate; equality within a class is a statutory standard, not a negotiable term.
- B) A manual cannot override the statute; applying rate distinctions without a hazard basis is still unfair discrimination.
- C) Refunding the excess later does not transform discrimination into something lawful — and would itself raise rebating concerns under §2324.
Memory hook
Same class, same hazard, same rate — or it is unfair discrimination.