After a hearing, a Colorado producer is found to have committed an unfair method of competition. Under C.R.S. § 10-3-1108(1)(a), what is the maximum monetary penalty?

Why A is correct

C.R.S. § 10-3-1108(1)(a) provides that after a hearing under C.R.S. § 10-3-1107, a violation of the unfair-competition and deceptive-practices provisions draws a penalty of not more than $3,000 per act, capped at $30,000 in the aggregate. The higher per-act and annual figures apply only to insurers that knew, or reasonably should have known, they were violating part 11.

Why the other options are wrong

• B) $10,000 per act is the C.R.S. § 10-3-1109 penalty for violating an existing cease and desist order, not the penalty for the initial violation.
• C) $30,000 per act with a $750,000 annual cap applies only when the violator is an insurer that knew or reasonably should have known it was violating part 11.
• D) $500 per act is the C.R.S. § 10-3-1109 figure for an individual who violates an existing order, not the general § 10-3-1108 penalty.

Memory hook

First strike under 1108: three thousand per act, thirty grand overall.