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Difficulty: MediumUnfair Trade Practices

Pair the following instances of prohibited producer conduct with their exact statutory classifications under state insurance law.

  • Refusing to conduct business with a particular general agency in an effort to drive them out of the local market.Boycott
  • Adding an optional accidental death rider to a life insurance application without obtaining the applicant's informed consent.Sliding
  • Charging differing premium rates for two individuals who are in the exact same health class and have the same life expectancy, solely due to their marital status.Unfair Discrimination
  • Publishing a marketing brochure that intentionally exaggerates the guaranteed returns of a fixed annuity product.False Advertising

Answer

The correct matches are: driving an agency out of the market aligns with Boycott; adding a rider without consent aligns with Sliding; charging different rates based on marital status aligns with Unfair Discrimination; and exaggerating guaranteed returns aligns with False Advertising.
Each provided scenario precisely illustrates a distinct Unfair Trade Practice violation. Boycott involves restrictive trade actions; Sliding addresses unauthorized product additions; Unfair Discrimination involves non-actuarial rate differences; and False Advertising covers deceptive marketing materials.

Step-by-Step Solution

1
Evaluate the scenario describing an organized refusal to do business.
This scenario matches with Boycott.
Any act of boycott, coercion, or intimidation resulting in unreasonable restraint of the insurance business is a clear statutory violation.
2
Evaluate the scenario regarding the unauthorized addition of a rider.
This scenario matches with Sliding.
Sliding specifically addresses the unethical practice of slipping hidden, optional charges into an application without the client's explicit permission.
3
Evaluate the scenario involving differing premiums for identical risk profiles.
This scenario matches with Unfair Discrimination.
Insurance rates must be based on actuarial data; treating identical risk profiles differently based on marital status violates discrimination statutes.
4
Evaluate the scenario concerning exaggerated annuity returns in a brochure.
This scenario matches with False Advertising.
Marketing materials must be strictly factual. Intentionally misstating guaranteed returns falls directly under false advertising regulations.

Key Concept

Unfair Trade Practices
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Topics

Unfair Trade Practices

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