State RegulationsCO specificDifficulty 2/5
An insurer knew, or reasonably should have known, that its claim-handling practices violated Colorado's unfair-competition provisions. After a hearing, under C.R.S. § 10-3-1108, the maximum penalty is:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
C.R.S. § 10-3-1108(1)(a) raises the penalty to not more than $30,000 per act, capped at $750,000 annually, when the violator is an insurer that knew or reasonably should have known it was violating part 11. The generic $3,000 per act cap applies only where that knowledge is absent.
Why the other options are wrong
- B) The $3,000 per act and $30,000 aggregate caps are the generic penalties, which the knowledge finding in this scenario exceeds.
- C) The $10,000 per act figure belongs to C.R.S. § 10-3-1109 penalties for violating an existing order, not to this scenario.
- D) The $500 per act figure applies to individuals who violate an existing cease and desist order under C.R.S. § 10-3-1109.
Memory hook
Knew and kept going: 30 an act, 750 a year.