Ethics/Compliance Question (HELP)

[rgleyzer]

Hi All, I'm a P&C owner and work with small/middle market clients. My state has one particular carrier that has been dominant in the healthcare industry for WC. So if I'm prospecting a client and find out they are insured with that market, there is virtually a 0% chance that any other carrier can write the business.

My question is whether, as an insurance agent, I can help pay for an operating cost of the insured in an effort to provide a stronger value proposition for an insured and get them to 1) move their business to me and a new carrier or 2) get them to assign the "dominant" carrier over via BOR. If the other broker is simply placing insurance coverage and that is all, well then I may have an interested client...

In my case, the "operating cost" I'm referring to is MVR checks, but theoretically could extend to any other service for purposes of this discussion. Does anyone currently do this now???

(I sent an email to my state's Dept of Insurance, but could take weeks to hear back)


Thanks!
RG

 

[VolAgent]

Other than the piece of advice I'm about to give you, I'd ignore any other advice you get on this topic.

This sounds like rebating. I would consult an attorney familiar with insurance law for agents/agencies and the DOI. I would ignore the opinion of anyone else. I know some states allow value added services, no idea if your state does and if they would consider it rebating or value added. So again, DOI or an attorney who works in this area.

 

[DHK]

I was going to write the same thing, but my mind got to over-analyzing it.

There's nothing wrong with offering additional value-added services for compensation or no compensation. Some insurance agents do tax preparation and notary services and things like that.

However, when you're using insurance-oriented tools and volunteering to be a "clearing firm for information" (for lack of a better term) in order to win business... it certainly feels 'suspect' for "selling information".

Generally, I wouldn't, but check with your DOI.

 

[BigSteve]

Hi All, I'm a P&C owner and work with small/middle market clients. My state has one particular carrier that has been dominant in the healthcare industry for WC. So if I'm prospecting a client and find out they are insured with that market, there is virtually a 0% chance that any other carrier can write the business.

My question is whether, as an insurance agent, I can help pay for an operating cost of the insured in an effort to provide a stronger value proposition for an insured and get them to 1) move their business to me and a new carrier or 2) get them to assign the "dominant" carrier over via BOR. If the other broker is simply placing insurance coverage and that is all, well then I may have an interested client...

In my case, the "operating cost" I'm referring to is MVR checks, but theoretically could extend to any other service for purposes of this discussion. Does anyone currently do this now???

(I sent an email to my state's Dept of Insurance, but could take weeks to hear back)

Thanks!
RG

Exactly what they VolAgent and DHK said. I'll add 1 more thing, do not provide MVRs that you have obtained from a carrier.