State RegulationsNC specificDifficulty 1/5
Under North Carolina's Insurance Information and Privacy Protection Act, how is an insurer's handling of an applicant's personal information governed?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under the Insurance Information and Privacy Protection Act (G.S. 58-39-5 through 58-39-120, Article 39), insurers must follow statutory standards for notice, authorization, and disclosure when they collect, use, or share an individual's personal information. The Act balances the industry's legitimate underwriting needs with the individual's right to know and correct the information held about them.
Why the other options are wrong
- A is wrong because the Act imposes notice and authorization requirements even for disclosures to affiliates; information cannot simply be shared freely.
- B is wrong because the Act does not require the Commissioner's prior approval of each collection of information; it sets conduct standards for insurers instead.
- D is wrong because the Act covers personal information generally, including financial and underwriting information, not only health data.
Memory hook
Article 39: notice, authorization, disclosure - privacy is a process, not a permission slip.