Referrals, Referrals, Referrals

[warnerins]

If it is illegal slap the cuffs on me and I quit

 

[saieddie]

Does anyone know about the legality of passing out gift cards for referrals? I've heard it's ok to give things to current clients as long as you give them the gift card regardless of whether or not the referral buys. Is that true?

As long as the gift isn't contingent on purchasing insurance and are available to everyone, gift cards are ok in Virginia.

This is what Virginia says:

"Section 38.2-509 – Rebates.
[FONT=Arial,Arial]Each year the Bureau of Insurance encounters a number of agents who, in an effort to attract and/or retain clients, provide some type of rebate to insureds in order to entice them to purchase an insurance policy. Subsection A 2 of this section, clearly states that no person shall: [/FONT]
[FONT=Arial,Arial]2. Pay, allow or give, or offer to pay, allow or give, directly or indirectly, as inducement to any insurance or annuity contract, any rebate of premium payable on the contract, any special favor or advantage in the dividends or other benefits on the contract, any valuable consideration or inducement not specified in the contract, except in accordance with an applicable rating plan authorized for use in this Commonwealth. [/FONT]
[FONT=Arial,Arial]Subsection 4 further states that no person shall: [/FONT]
[FONT=Arial,Arial]4. Receive or accept as inducement to insurance, or annuity contracts, any rebate of premium payable on the contract, any special favor or advantage in the dividends or other benefit to accrue on the contract, or any valuable consideration or inducement not specified in the contract. [/FONT]
[FONT=Arial,Arial]This makes it a violation of the Virginia Insurance Code for any agent to offer an inducement to an insured to purchase a contract of insurance. Agents will commonly hand out small items to their clients [/FONT]
[FONT=Arial,Arial]such as mugs, calendars, and other related items. Such items are generally considered advertising. The violation occurs when an agent offers to give any valuable consideration or inducement to a consumer based upon the consumer's purchase of an insurance policy. The Bureau often advises agents that if they are going to give away items such as gift certificates for restaurants, t-shirts, or other such items, they should make these items available to anyone who enters their agency, whether they purchase an insurance policy or not. As long as the receipt of the item is not contingent upon the purchase of an insurance policy, there is no violation. "[/FONT]

http://www.scc.virginia.gov/division/boi/webpages/inspagedocs/commonproblemsagentinvestigation.pdf