31A-23a-504 - Sharing commissions.
31A-23a-504. Sharing commissions.
(1) (a) Except as provided in Subsection 31A-15-103(3), a licensee under this chapter oran insurer may only pay consideration or reimburse out-of-pocket expenses to a person if thelicensee knows that the person is licensed under this chapter as to the particular type of insuranceto act in Utah as:
(i) a producer;
(ii) a limited line producer;
(iii) a customer service representative;
(iv) a consultant;
(v) a managing general agent; or
(vi) a reinsurance intermediary.
(b) A person may only accept commission compensation or other compensation as aperson described in Subsections (1)(a)(i) through (vi) that is directly or indirectly the result of aninsurance transaction if that person is licensed under this chapter to act as described inSubsection (1)(a).
(2) (a) Except as provided in Section 31A-23a-501, a consultant may not pay or receive acommission or other compensation that is directly or indirectly the result of an insurancetransaction.
(b) A consultant may share a consultant fee or other compensation received forconsulting services performed within Utah only:
(i) with another consultant licensed under this chapter; and
(ii) to the extent that the other consultant contributed to the services performed.
(3) This section does not prohibit:
(a) the payment of renewal commissions to former licensees under this chapter, formerTitle 31, Chapter 17, or their successors in interest under a deferred compensation or agencysales agreement;
(b) compensation paid to or received by a person for referral of a potential customer thatseeks to purchase or obtain an opinion or advice on an insurance product if:
(i) the person is not licensed to sell insurance;
(ii) the person does not sell or provide opinions or advice on the product; and
(iii) the compensation does not depend on whether the referral results in a purchase orsale; or
(c) the payment or assignment of a commission, service fee, brokerage, or other valuableconsideration to an agency or a person who does not sell, solicit, or negotiate insurance in thisstate, unless the payment would constitute an inducement or commission rebate under Section31A-23a-402.
(4) (a) In selling a policy of title insurance, sharing of commissions under Subsection (1)may not occur if it will result in:
(i) an unlawful rebate;
(ii) compensation in connection with controlled business; or
(iii) payment of a forwarding fee or finder's fee.
(b) A person may share compensation for the issuance of a title insurance policy only tothe extent that the person contributed to the search and examination of the title or other servicesconnected with the title insurance policy.
(5) This section does not apply to a bail bond producer or bail enforcement agent as
defined in Section 31A-35-102.
Amended by Chapter 349, 2009 General Session