02- 031 C.M.R. ch. 270, § 12 - Permitted compensation arrangements
(A) An
insurer or other entity may provide commission or other compensation to an
agent or other representative for the sale of a Medicare supplement policy or
certificate only if the first year commission or other first year compensation
is no more than 200 percent (200%) of the commission or other compensation paid
for selling or servicing the policy or certificate in the second year or
period.
(B) The commission or other
compensation provided in subsequent (renewal) years must be the same as that
provided in the second year or period and must be provided for a reasonable
number of renewal years.
(C) If an
existing policy or certificate is replaced, no entity shall provide to its
agents or other producers, and no agent or producer shall receive, compensation
greater than the renewal compensation payable by the replacing insurer on
renewal policies or certificates, unless benefits of the new policy or
certificate are clearly and substantially greater than the benefits under the
replaced policy.
(D) For purposes
of this section, "compensation" includes pecuniary or non-pecuniary
remuneration of any kind relating to the sale or renewal of the policy or
certificate , including but not limited to bonuses, gifts, prizes, awards and
finder's fees.
Notes
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