State RegulationsTX specificDifficulty 2/5
A Texas insurer receives an applicant's HIV test result, which is positive. Which statement best describes how the insurer may use that information in its underwriting decision?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under 28 TAC 21.705, an insurer may use AIDS-related test results in underwriting only if that use is described in the insurer's underwriting standards filed with the Texas Department of Insurance and applied uniformly to all applicants in the same class. The rule is a discipline rule, not an automatic decline rule: an insurer that invents an ad hoc rule for one applicant, or that notifies a third party of the result, violates 28 TAC 21.704-.705 and is exposed to TDI sanctions.
Why the other options are wrong
- B) 28 TAC 21.705 does not mandate a declination; it requires only that any use of the result follow filed, uniformly applied underwriting standards.
- C) There is no requirement to issue with an immune-deficiency endorsement; conditioning coverage that way for one applicant would itself breach the filed-standards and uniformity requirements.
- D) Disclosing the applicant's status to the policyholder violates the confidentiality requirement of 28 TAC 21.705 and is not an underwriting option.
Memory hook
Filed, uniform, then used; never ad hoc, never disclosed.