A Georgia producer hands out flyers claiming that a competing insurer is insolvent and cannot pay claims, a statement the producer knows to be false. Which unfair trade practice has the producer committed?

Why A is correct

Under O.C.G.A. § 33-6-4(b)(3), defamation means making, publishing, disseminating, or circulating any oral or written statement that is false, or maliciously critical of or derogatory to any person, and calculated to injure that person or the insurance business. Knowingly circulating false insolvency claims about a competitor is textbook defamation and grounds for action by the Insurance Commissioner.

Why the other options are wrong

• B) Rebating involves giving or accepting premiums or valuable consideration not specified in the contract — nothing in this fact pattern involves a rebate.
• C) Twisting is misrepresenting policy terms to induce a policyholder to lapse, forfeit, or surrender an existing policy; no replacement is taking place here.
• D) Coercion under O.C.G.A. § 33-6-4(b)(4) involves boycott, intimidation, or compelling action against a person's will, not disparaging statements about a competitor.

Memory hook

False and derogatory = defamatory — even if it is just a flyer.