Under Tennessee insurance law, two competing insurers privately agree that neither will write business through a particular managing general agency until the agency reduces its commission demands. Which unfair trade practice have the insurers committed?

Why B is correct

T.C.A. § 56-8-104(4) prohibits boycott, coercion, and intimidation as unfair trade practices. A boycott is a concerted refusal to deal, entered into by two or more insurers acting together, designed to force a third party to yield on a business term. When competing insurers combine to cut off an agency's business until it lowers its commission demands, they have joined in exactly the concerted pressure the statute forbids, and each faces corrective action by the Tennessee Department of Commerce & Insurance.

Why the other options are wrong

• A) Defamation requires false oral or written statements attacking a competitor's financial condition or character; refusing to deal is not a statement at all.
• C) Rebating involves offering valuable consideration to insurance applicants and policyowners to induce a purchase, not pressuring a vendor over commission terms.
• D) False advertising concerns misleading representations about insurance policies published to the public; a private dealer-refusal agreement is not advertising.

Memory hook

Two insurers agreeing to freeze someone out = boycott: concerted refusal is the trigger.