Study guide
18.3 Privacy (HIPAA/GLBA), Fraud, and Consumer Protection
California Life & Health Insurance State
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1 Standalone Coverage Map
Standalone Coverage Map: National Content vs. California Rules
2 Introduction: California Life & Health Insurance Exam Overview
California Life & Health Exam Overview
3 National Portion: Insurance & Risk Fundamentals
Risk, Peril, Hazard, and the Law of Large Numbers Insurable Interest, Indemnity, and Insurance Principles Insurance Contract Law and Elements Producers, Agents, Brokers, and Authority Types of Insurers and Distribution Systems
4 National Portion: Life Insurance Basics
2.1 Purpose and Need for Life Insurance 2.2 Term Life Insurance 2.3 Whole Life Insurance 2.4 Adjustable, Limited-Pay, and Endowment
5 National Portion: Interest-Sensitive & Variable Life
3.1 Universal Life Insurance 3.2 Variable and Variable Universal Life 3.3 Indexed Universal Life 3.4 Specialized Policies (Joint, Survivorship, Juvenile)
6 National Portion: Life Policy Provisions & Options
4.1 Standard Policy Provisions and Beneficiaries 4.2 Nonforfeiture Options and Cash Value 4.3 Dividend Options and Settlement Options 4.4 Policy Loans, Withdrawals, and Assignments
7 National Portion: Life Riders & Underwriting
5.1 Living Benefit and Disability Riders 5.2 Death Benefit and Insured Riders 5.3 Life Insurance Underwriting and Risk Classification 5.4 Field Underwriting, Applications, and Replacement
8 National Portion: Annuities - Structure & Types
6.1 Annuity Principles and Parties 6.2 Fixed and Immediate Annuities 6.3 Deferred and Indexed Annuities 6.4 Variable Annuities
9 National Portion: Annuities - Payout, Uses & Suitability
7.1 Annuity Payout Options and Annuitization 7.2 Uses of Annuities and Suitability 7.3 Annuity Regulation and Disclosure
10 National Portion: Life & Annuity Taxation, Group, and Retirement
8.1 Taxation of Life Insurance and MEC Rules 8.2 Taxation of Annuities 8.3 Group Life Insurance 8.4 Qualified Plans, IRAs, and Retirement (TEFRA/SEP/401k)
11 National Portion: Health Insurance Basics
9.1 Health Insurance Concepts and Defining the Insured 9.2 Medical Expense Insurance (Basic and Major Medical) 9.3 Managed Care: HMO, PPO, POS, and HSA/HDHP 9.4 Cost Containment and Provider Arrangements
12 National Portion: Disability Income Insurance
10.1 Disability Income Policies and Definitions of Disability 10.2 Benefit Periods, Elimination Periods, and Riders 10.3 Business Disability (Key Person, Buy-Sell, BOE) 10.4 Disability Underwriting and Taxation
13 National Portion: Health Policy Provisions & Clauses
11.1 Required and Optional Uniform Provisions 11.2 Renewability and Continuation Provisions 11.3 Exclusions, Riders, and Pre-Existing Conditions 11.4 Claims, Coordination of Benefits, and Subrogation
14 National Portion: Group Health & Employer Plans
12.1 Group Health Fundamentals and Eligibility 12.2 Group Underwriting and Contribution/Participation 12.3 COBRA, HIPAA, and Continuation 12.4 Section 125 / Cafeteria Plans and Self-Funding
15 National Portion: Senior & Government Health Programs
13.1 Medicare Parts A, B, C, and D 13.2 Medicare Supplement (Medigap) Policies 13.3 Medicaid and Long-Term Care Partnership 13.4 Social Security Disability and Benefits
16 National Portion: Long-Term Care & Supplemental Health
14.1 Long-Term Care Insurance 14.2 Dental, Vision, and Limited Benefit Plans 14.3 Specified Disease, Critical Illness, and Hospital Indemnity 14.4 Accidental Death & Dismemberment and Supplemental
17 National Portion: Affordable Care Act & Individual Market
15.1 ACA Essential Health Benefits and Metal Levels 15.2 Guaranteed Issue, Rating Rules, and Marketplaces 15.3 Premium Tax Credits and Cost-Sharing Reductions
18 National Portion: Underwriting, Producers & Claims
16.1 Health Underwriting and Risk Selection 16.2 Application, Producer Responsibilities, and Fair Credit Reporting 16.3 Claims Handling and Fraud Prevention
19 National Portion: Insurance Regulation & Licensing
17.1 State Regulation, Licensing, and McCarran-Ferguson 17.2 Marketing, Advertising, and Replacement Regulation 17.3 Company Operations, Solvency, and Guaranty Associations
20 National Portion: Ethics & Unfair Trade Practices
18.1 Unfair Trade Practices and Unfair Claims Settlement 18.2 Producer Ethics, Fiduciary Duty, and Suitability 18.3 Privacy (HIPAA/GLBA), Fraud, and Consumer Protection
21 Chapter 1: California Insurance Regulation & Licensing
1.1 California Department of Insurance (CDI) 1.2 California Producer Licensing Requirements 1.3 License Maintenance and Continuing Education
22 Chapter 2: California Life Insurance Laws
2.1 California Life Insurance Policy Requirements 2.2 California Annuity Regulations 2.3 California Replacement Rules
23 Chapter 3: California Health Insurance Laws
3.1 California Health Insurance Policy Requirements 3.2 California Medicare Supplement (Medigap) Regulations 3.3 California Disability and Long-Term Care Insurance
24 Chapter 4: California Insurance Ethics & Prohibited Practices
4.1 Unfair Trade Practices 4.2 Producer Conduct and Fiduciary Duties 4.3 California Life and Health Insurance Guarantee Association
25 Chapter 5: California Annuity Regulations & Senior Protections
5.1 California Annuity Best Interest Standard 5.2 California Senior Consumer Protections 5.3 California Variable Annuity and Indexed Annuity Regulations
26 Chapter 6: California Group Insurance & Special Topics
6.1 California Group Life and Health Insurance Requirements 6.2 California COBRA and Cal-COBRA Continuation 6.3 California State Insurance Programs
18.3 Privacy (HIPAA/GLBA), Fraud, and Consumer Protection
Key Takeaways Explain This Topic AI
GLBA protects nonpublic personal (financial) information and requires privacy notices plus an opt-out before sharing NPI with non-affiliates.
HIPAA protects protected health information and provides health-coverage portability and renewability protections.
18 U.S.C. 1033/1034 makes insurance fraud a federal crime; a disqualifying felony requires a 1033 waiver from the commissioner to work in insurance.
The Fair Credit Reporting Act requires written notice within 3 days when an investigative consumer report is ordered.
Replacement regulations mandate disclosure forms and an extended free-look to protect consumers from twisting and churning.
Last updated: June 2026
Privacy protections: GLBA and HIPAA
Two federal privacy frameworks dominate the national exam. The Gramm-Leach-Bliley Act (GLBA) governs how financial institutions, including insurers, handle nonpublic personal information (NPI) . GLBA requires insurers to give consumers a privacy notice at the start of the relationship and annually , describing what information is collected and shared, and to provide an opt-out before sharing NPI with non-affiliated third parties. NPI includes financial information such as account balances and application data.
The Health Insurance Portability and Accountability Act (HIPAA) protects protected health information (PHI) and standardizes health-coverage rules. Its Privacy Rule limits use and disclosure of PHI to treatment, payment, and health-care operations without authorization. HIPAA also created portability protections, limiting how pre-existing condition exclusions can be applied and guaranteeing certain renewability — concepts that overlap with the health-insurance chapters.
GLBA distinguishes between sharing within affiliated companies (broadly permitted) and sharing with non-affiliated third parties (which triggers the opt-out). Certain disclosures are exempt from the opt-out entirely — for example, sharing needed to process a transaction the consumer requested, to service the account, or as required by law. HIPAA likewise allows PHI disclosure without authorization for treatment, payment, and operations, but routine marketing or sale of PHI requires explicit written authorization from the individual.
Privacy notices at a glance
- Requirement GLBA HIPAA
- Information type Nonpublic personal (financial) info (NPI) Protected health information (PHI)
- Initial notice At establishment of relationship Notice of Privacy Practices at first delivery of service
Opt-out / authorization Opt-out before sharing NPI with non-affiliates Written authorization for non-routine disclosures
Annual notice Generally required (limited exceptions) Notice available on request
The NAIC Privacy of Consumer Financial and Health Information Regulation implements GLBA at the state level for insurers and distinguishes between a consumer (one transaction) and a customer (ongoing relationship); customers receive the recurring annual notice.
A data breach triggers separate breach-notification duties under most state laws: the insurer must notify affected individuals (and often the department and credit bureaus) within a defined window when unencrypted personal information is compromised. The exam may test the who-receives-which-notice distinction, so anchor it: privacy notices go out routinely to consumers and customers, while breach notices go out only after a security incident exposes protected data.