State RegulationsCO specificDifficulty 2/5
A Denver insurer tells its appointed producers that their appointments will be terminated unless they agree not to place business with a competing insurer. Under C.R.S. § 10-3-1104(1)(d), this is an example of:
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Why B is correct
C.R.S. § 10-3-1104(1)(d) prohibits boycott, coercion, and intimidation in the insurance business. Threatening to terminate appointments unless producers refuse to place business with a competitor coerces the producers' independent judgment and is an unfair method of competition the Colorado Commissioner of Insurance can penalize.
Why the other options are wrong
- A) Rebating involves returning premiums or giving unlawful inducements to purchasers, not threatening producers.
- C) Controlled business concerns a producer writing policies on his or her own interests, not coercion of producers.
- D) Defamation is false or maliciously critical statements about a competitor's financial condition, not threats against producers.
Memory hook
Coercion = forcing producers' hands with threats.