Unfair Discrimination
Charging different rates or offering different benefits to people of the same class and equal risk, based on factors unrelated to loss exposure.
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Practice This Concept
Which factor is typically considered in the underwriting and rating of an individual disability income policy?
The insured's occupation classification, which reflects the level of occupational risk — Disability income underwriters classify applicants primarily by occupation, because a surgeon, a construction worker, and an office manager face very different disability risks, along with age, gender, health history, and avocations such as hazardous hobbies. Occupation classification is a central rating factor since the risk of disability varies widely with the work performed, and it directly shapes both the premium and the benefit period the insurer will offer. Unfair discrimination based on race, national origin, and similar protected classes is prohibited, and factors such as existing life insurance holdings are not disability rating inputs.
National insurance concept
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