State RegulationsCO specificDifficulty 2/5
A licensed producer in Denver is offered a commission to solicit health applications for an insurer that has not been authorized to do business in Colorado. What is the lawful conclusion?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Colorado's unauthorized-entity provisions, C.R.S. § 10-3-903 through § 10-3-908, reserve the transaction of insurance business in this state to entities authorized by the Colorado Division of Insurance. A producer who solicits applications for an unauthorized insurer aids an unlawful transaction and faces Commissioner action, regardless of the insurer's home-state status.
Why the other options are wrong
- A) A home-state license does not substitute for Colorado authorization; the unauthorized-entity provisions reach out-of-state insurers doing business here.
- B) An applicant's written waiver cannot cure the lack of Colorado authorization for the insurer.
- D) Collecting premiums in advance does not make a solicitation for an unauthorized insurer lawful.
Memory hook
Not authorized in Colorado? Then not solicit-able in Colorado.