Ohio Code 3905.18 – Paying unlawful consideration
(A) Neither an insurer nor an insurance agent shall pay a commission, service fee, brokerage fee, or other type of consideration to a person for selling, soliciting, or negotiating insurance in this state, if the person is required to be licensed by the superintendent of insurance under this chapter but is not so licensed. However, renewal or other deferred commissions may be paid to such a person for selling, soliciting, or negotiating insurance in this state if the person was required to be licensed under this chapter at the time of the sale, solicitation, or negotiation and was so licensed at that time.
Terms Used In Ohio Code 3905.18
- agent: means any person that, in order to sell, solicit, or negotiate insurance, is required to be licensed under the laws of this state, including limited lines insurance agents and surplus line brokers. See Ohio Code 3905.01
- Insurance: means any of the lines of authority set forth in Chapter 1739. See Ohio Code 3905.01
- Negotiate: means to confer directly with, or offer advice directly to, a purchaser or prospective purchaser of a particular contract of insurance with respect to the substantive benefits, terms, or conditions of the contract, provided the person that is conferring or offering advice either sells insurance or obtains insurance from insurers for purchasers. See Ohio Code 3905.01
- Person: means an individual or a business entity. See Ohio Code 3905.01
- Sell: means to exchange a contract of insurance by any means, for money or its equivalent, on behalf of an insurer. See Ohio Code 3905.01
- Solicit: means to attempt to sell insurance, or to ask or urge a person to apply for a particular kind of insurance from a particular insurer. See Ohio Code 3905.01
- state: means the state of Ohio. See Ohio Code 1.59
- superintendent of insurance: means the superintendent of insurance of this state. See Ohio Code 3905.01
(B) An insurer shall not pay a commission, service fee, brokerage fee, or other type of consideration to an insurance agent for selling, soliciting, or negotiating insurance in this state, if the insurance agent is required to be appointed by the insurer but is not so appointed.
(C) An insurer or insurance agent may pay or assign a commission, service fee, brokerage fee, or other type of consideration to an insurance agency or to any person who does not sell, solicit, or negotiate insurance in this state, unless the payment or assignment is prohibited by division (B)(7) of section 3901.211 or by section 3911.20, 3933.01, or 3999.22 of the Revised Code.
(D) No insurer or insurance agent shall pay a commission, referral fee, or other compensation to an unlicensed person for any referral unless the compensation is a fixed dollar amount for each referral and does not depend on whether the person referred purchases an insurance product.