State RegulationsAZ specificDifficulty 3/5
An Arizona life insurer reviews two applicants who belong to the same actuarial class and have the same expectation of life. Which underwriting practice is PROHIBITED under A.R.S. 20-448?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
A.R.S. 20-448 prohibits making or permitting unfair discrimination between individuals of the same class and equal expectation of life in premiums, benefits, or terms. Two same-class applicants with equal life expectancy must be treated on the class's actuarial terms; an arbitrary split, such as neighborhood income outside the class criteria, is prohibited. The statute also protects applicants from discrimination based on genetic-testing information and domestic-abuse status.
Why the other options are wrong
- B) Rating by the class's actual mortality experience is the permitted actuarial method.
- C) Uniform evidence requirements treat the class alike and are permitted.
- D) Applying standard exclusions equally is even-handed treatment, not discrimination.
Memory hook
Same class, same expectancy, same price — A.R.S. 20-448 bars arbitrary splits.