State RegulationsCO specificDifficulty 2/5
Two Colorado insurers that compete for commercial accounts agree among themselves to stop doing business with a repair shop that also serves a rival insurer. How is this agreement classified under Colorado law?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
C.R.S. § 10-3-1104(1)(d) prohibits boycotts, coercion, and intimidation as unfair methods of competition. Two competing insurers agreeing to withhold business from a firm because it also serves a rival is a classic boycott intended to restrain competition, and it exposes both insurers to penalties under part 11 of article 3 of title 10.
Why the other options are wrong
- B) Defamation requires false or maliciously critical statements about financial condition; the agreement makes none.
- C) Nothing of premium value or any contract benefit was returned to anyone as an inducement.
- D) The unfair-discrimination provisions govern the treatment of insurance applicants and policy classifications, not trade suppliers.
Memory hook
Group refusal to deal equals boycott; the statute calls it unfair competition.