Market conduct examinations determine whether an insurer has followed state laws about:

• A. Investment portfolios only
• B. Marketing, advertising, sales, underwriting, rating, and claims handling
• C. Actuarial pricing models only
• D. Reinsurance treaties

Answer: (B)

Market conduct examinations focus on how an insurer runs its business in relation to consumers and in support of state laws and regulations. They examine practices across marketing, advertising, sales, underwriting, rating, and claims handling to ensure fair dealing, accuracy, and compliance throughout the policy lifecycle. This broad scope is what makes the listed areas—marketing and sales practices, underwriting, rating, and claims handling—the core focus, since they directly affect customers and how policies are placed and serviced.

Investment portfolios, actuarial pricing models, and reinsurance treaties pertain to financial management, pricing methodology, and risk transfer arrangements, which are overseen by other regulatory areas rather than market conduct examinations.