Texas Life Agent Practice Exam

The fair credit reporting act allows which of the following rights to the applicant?

1. The right to dispute the report with the insurance company

2. The right to receive a free policy upon denial

3. The right to obtain a copy of the report from any source

4. The right to know the exact reason for denial

The correct answer is: The right to dispute the report with the insurance company

The Fair Credit Reporting Act (FCRA) establishes certain rights for individuals when it comes to their credit information. One of the essential rights granted under this act is the right to dispute inaccuracies in a credit report. If an applicant finds that a report contains errors or misleading information, they have the ability to raise these disputes directly with the insurance company (or other entities that provided the report). This process ensures that consumers can challenge any incorrect data that might negatively affect their access to insurance or other financial services. When the insurance company acknowledges the dispute, they are required to investigate and provide a resolution, which helps protect the applicant’s interests. The other choices do not accurately reflect the rights conferred by the FCRA. While individuals do have the right to request a copy of their credit report, this is generally from the credit reporting agency, not any source. Free policies upon denial are not a stipulation of the act, nor is there a guaranteed right to know the exact reasons for denial. Instead, the act focuses primarily on disputes and ensuring fair reporting practices.