If you were an underwriter of personal auto insurance, which of the following underwriting criteria would you most prefer to use because of its incentive value?
A) Gender
B) Age
C) Driving record
D) Health

Question

Quizplus · Accepted Answer

The driving record is the best choice for underwriting criteria because it directly reflects the risk involved in insuring a driver. A good driving record indicates a lower risk of accidents and claims, while a poor driving record indicates a higher risk. Incentivizing good driving behavior through insurance discounts can further motivate drivers to maintain a clean driving record. Gender and age are discriminatory factors and not necessarily indicative of risk, while health is not relevant to auto insurance underwriting.

If You Were an Underwriter of Personal Auto Insurance, Which