The correct answer is: C. Both A & B
An agent’s confidential report is a document that is prepared by an insurance agent and submitted to the insurance company. The report includes information about the proposer’s lifestyle, habits, and financial situation. The moral hazard report is a document that is prepared by the insurance company and includes information about the proposer’s claims history. Both reports can reflect on the lifestyle and habits of a proposer.
An agent’s confidential report can include information about the proposer’s:
- Age
- Occupation
- Marital status
- Health
- Driving record
- Credit score
- Financial situation
- Lifestyle habits (e.g., smoking, drinking, gambling)
The moral hazard report can include information about the proposer’s:
- Claims history
- Type of claims
- Frequency of claims
- Amount of claims
Both reports can be used by the insurance company to assess the risk of insuring the proposer. If the proposer has a risky lifestyle or habits, the insurance company may charge a higher premium or may refuse to insure the proposer altogether.