State RegulationsCO specificDifficulty 2/5
A Colorado insurer receives a sickness and accident claim but never acknowledges the policyholder's communications and denies the claim without any investigation. Under C.R.S. § 10-3-1104(1)(h), these acts are:
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
C.R.S. § 10-3-1104(1)(h) enumerates failing to acknowledge communications with reasonable promptness, failing to maintain reasonable standards for investigation, and refusing to pay claims without conducting a reasonable investigation. The Colorado Division of Insurance can proceed on these enumerated acts without waiting for a pattern, if the conduct is willful.
Why the other options are wrong
- A) Disputed coverage does not suspend the insurer's statutory duties to acknowledge and investigate.
- B) Internal complaint procedures supplement, but never replace, the unfair-practices statute.
- C) A prompt denial letter cannot cure the failure to investigate; both duties are separately enumerated.
Memory hook
Acknowledge, investigate, then decide — skipping steps is the violation.