Under the federal Gramm-Leach-Bliley Act (GLBA), insurance companies and agents must:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
The Gramm-Leach-Bliley Act requires financial institutions, including insurers and insurance agents, to provide consumers with clear privacy notices explaining what information is collected and how it is shared, and to protect the security and confidentiality of nonpublic personal financial information. Consumers must be given the opportunity to opt out of certain disclosures to nonaffiliated third parties. California supplements these federal requirements with the Insurance Information and Privacy Protection Act and financial-privacy statutes, and violations can lead to regulatory action. Producers should therefore treat every customer's personal and financial data as confidential.
Why the other options are wrong
- B) GLBA requires notice and generally an opt-out before sharing nonpublic information with nonaffiliated third parties; sharing is not free of restriction.
- C) Medical records are sensitive information whose disclosure is restricted; they are not published for marketing or newsletters.
- D) Coverage cannot be conditioned on waiving privacy rights; the Act protects consumers rather than extracting waivers.
Memory hook
GLBA: tell them what you collect, guard what you keep, and let them say no to outside sharing.