State RegulationsCO specificDifficulty 1/5
An agency owner tells an auto repair shop that referral business will be steered away from the shop unless the shop accepts the agency's repair-pricing terms. Which unfair-competition practice does this conduct illustrate?
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Why C is correct
C.R.S. 10-3-1104(1)(d) prohibits boycott, coercion, and intimidation in the insurance business. Using economic pressure - threatening to cut off referrals in order to force acceptance of terms - is a classic coercion scenario that the Colorado Commissioner of Insurance may sanction.
Why the other options are wrong
- A) No rates or benefits were differentiated between similarly situated persons, so unfair discrimination is not the practice shown.
- B) Controlled business concerns a producer's own related premium volume exceeding other business, not third-party pressure tactics.
- D) No false or maliciously critical statement about a competitor's financial condition was made.
Memory hook
Pressure to play ball is coercion.