Comensating Agents

[MOHEALTH]

Can anyone tell me if there any rules and/or regulations in regards to compensating other agents for referrals?

 

[CHUMPS FROM OXFORD]

Hmmm. I don't think so. It is not rebating since the insured is not receiving any consideration.

 

[MOHEALTH]

5 hours and only 1 response? C'mon...all those veteran
brains out there filled with knowledge and no one can answer this simple little question???? OK...so I spelled "compensating" wrong in the title....cut me some slack!!

 

[The Rabbi]

Can anyone tell me if there any rules and/or regulations in regards to compensating other agents for referrals?

I'm sure every state is different. Check with your state's dept of insurance.

 

[Winter_123]

Can anyone tell me if there any rules and/or regulations in regards to compensating other agents for referrals?

It is not as easy a question as one may think because it is dependent on the specific facts. If you have a business relationship with other agents or another agency where you pay them a set amount per month for whatever business they refer over (which does not change up or down depending on the volume) or for the "privilege" of being associated with them then that is one thing and probably allowable.

However, if there is no payment unless a specific case is written and/or your compensation to them is related to the payout of the case, then it is essentially a backhanded commission split, or is treated as such by many states. The same question comes up in regard to telemarketers. There are agents out there and probably here who are just flat out givng bonuses or additional payout when a case is closed. Not good. That is commission splitting. Yes, I know it is done everyday. Same answer. If you want to begin to pay the telemarketer more per hour or something generic that reflects the fact that more cases are being closed then probably that works.

Winter