What is a valid reason for an insurer to refuse an insurance policy?

The choice regarding the applicant's health condition is valid because insurers often consider an individual's health when assessing risk for certain types of insurance, such as life or health insurance. An applicant's health status can directly impact the likelihood and frequency of claims, allowing insurers to evaluate potential financial exposure in offering coverage. If an applicant has pre-existing conditions or significant health risks, it can be a legitimate basis for the insurer to refuse coverage, impose higher premiums, or implement exclusions in the policy.

In many jurisdictions, including South Carolina, regulations exist to protect against discrimination based on personal characteristics such as religion, race, and gender, which are not legitimate factors for underwriting decisions. Insurers must comply with these laws, making it inappropriate for them to base decisions on these characteristics. Hence, health conditions are a relevant factor, while the other options are generally prohibited bases for refusal.