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Metro City Has Six Different Zip Codes

question 38

Multiple Choice

Metro City has six different zip codes.XYZ Insurance Company markets coverages in Metro City.Any applicant who lists one particular zip code is automatically quoted a premium that is twenty percent more than the average premium for applicants from the other five zip codes,even if the loss exposure is identical.Which regulatory objective is not being met given XYZ's premium structure?


Definitions:

Constructive Partnership

A legal concept where a partnership is deemed to exist based on the actions or conduct of the parties, despite there being no formal agreement.

Actual Partnership

A type of business partnership that exists when two or more individuals engage in a business for profit with an express or implied agreement of partnership, as opposed to being legally deemed partners by the law.

Purported Partner

Implies someone alleged or claimed to be a partner in a business or enterprise, often without the legal or formal acknowledgment of such a partnership.

Substantial Reliance

A level of dependence on a promise or statement significant enough to alter one's position, often referenced in contract law.

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