State RegulationsIL specificDifficulty 2/5
The Director of Insurance receives a complaint that an insurer is using unfair methods of competition in the Illinois insurance business. What is the proper source of the Director's authority to act?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
215 ILCS 5/431 places unfair methods of competition and unfair or deceptive acts or practices in the insurance business within the Director of Insurance's jurisdiction under the Illinois Insurance Code. The Director may investigate and enforce against such practices, working alongside the Code's specific unfair-practice articles.
Why the other options are wrong
- B) No legislative referral is required; the Director's enforcement authority over unfair methods comes directly from 215 ILCS 5/431.
- C) The Illinois Human Rights Act addresses discrimination and is not the source of the Director's insurance trade-practice jurisdiction.
- D) The Director clearly has statutory jurisdiction over unfair methods of competition under 215 ILCS 5/431; court action is not the exclusive remedy.
Memory hook
Unfair tactics land on the Director's desk under the Code's unfair-methods provision.