Which conduct may be the subject of a cease and desist order issued under the unfair and deceptive practices provisions of TIC 541.107-.108 and 541.151?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under TIC 541.107-.108 and 541.151, the Commissioner's cease and desist authority expressly extends to unfair methods of competition and unfair or deceptive acts or practices in the business of insurance, whether the conduct is underway, completed, or merely threatened. This is the trade-practice branch of the same remedy found in Chapter 83. Practically, misrepresentation in a sales presentation, deceptive advertising, or an unfair claims practice can be stopped by order immediately, and the department does not need to prove that anyone has yet been financially harmed.
Why the other options are wrong
- B) A prior court judgment is not required; the remedy is administrative and may be invoked by the department on its own investigation.
- C) The reach is not confined to rate and form filings; the statute covers unfair and deceptive trade practices generally, of which filings are only one narrow area.
- D) A delinquency, receivership, or conservatorship proceeding need not be pending; the company's financial condition is irrelevant to whether its trade practices may be stopped.
Memory hook
Chapter 541 means unfair or deceptive — the order can stop it now, not after a lawsuit.