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Insurance Broker pays off insured's loan?
Posted: Mon Feb 08, 2010 9:39 pm
by Mary1621
I am financing a large life insurance policy through an a company that financing premium life insurance payments. The company is sending the funds to the insurance broker. The insurance broker will send the premium to buy the policy. The broker has offered to pay off the loan from the insurance commission, is this legal? Why would an agent do this?
Re: Insurance Broker pays off insured's loan?
Posted: Tue Feb 09, 2010 12:12 pm
by FFA
Sounds like rebating to me.
Re: Insurance Broker pays off insured's loan?
Posted: Tue Feb 09, 2010 12:28 pm
by ForumReader1
Mary, are you the policyholder (insured)? I agree it sounds like rebating, which is illegal. You may want to contact the consumer division of your state's Department of Insurance for guidance.
Re: Insurance Broker pays off insured's loan?
Posted: Tue Feb 09, 2010 2:36 pm
by justthere
If it is in California, rebating is legal as far as I know. However, if the new or old policy is a variable product, then there are serious FINRA issues. I would check that out.