Kentucky Statutes 304.9-425 – Payment or acceptance of commission, brokerage, or other valuable consideration — Exception
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(1) No insurer, financial institution, agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, life settlement broker or provider, or consultant shall pay, directly or indirectly, any commission, brokerage, or other valuable consideration to any individual or business entity for services as an agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, life settlement broker or provider, or consultant within this state, unless the individual or business entity held at the time the services were performed a valid license for that line of insurance as required by the laws of this state for the services.
(2) No individual or business entity, other than an individual or business entity duly licensed by this state as an agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, life settlement broker or provider, or consultant at the time the services were performed, shall accept any commission, brokerage, or other valuable consideration for those services, unless the individual or business entity is licensed at the time the services were performed, if a license is required by law.
(3) This section shall not prevent payment or receipt of renewal or other deferred commissions to or by any individual or business entity entitled under this section.
(4) Services as an agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, or consultant within this state shall not include a referral by an unlicensed person of a consumer to a licensed agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, or consultant that does not include a discussion of specific insurance policy terms and conditions.
(5) An insurer, financial institution, agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, or consultant may pay any compensation, fee, or other consideration to an individual not licensed to sell insurance for the referral of a consumer to a licensed individual, only if the consideration is paid regardless of whether the insurance coverage is sold to the consumer.
Effective: June 25, 2013
History: Amended 2013 Ky. Acts ch. 123, sec. 2, effective June 25, 2013. — Amended
2010 Ky. Acts ch. 83, sec. 10, effective July 15, 2010. — Amended 2008 Ky. Acts ch.
32, sec. 18, effective July 15, 2008. — Amended 2002 Ky. Acts ch. 273, sec. 33, effective July 15, 2002. — Amended 2000 Ky. Acts ch. 393, sec. 31, effective July
14, 2000. — Created 1982 Ky. Acts ch. 171, sec. 6, effective July 15, 1982.
Legislative Research Commission Note (7/15/2008). 2008 Ky. Acts ch. 32 intended to change all existing references in the KRS from “viatical settlements” to “life settlements.” One reference to “viatical settlement” in this section was overlooked during the bill drafting process. The Reviser of Statutes has made this change upon the authority of KRS § 7.136(1)(h).
(2) No individual or business entity, other than an individual or business entity duly licensed by this state as an agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, life settlement broker or provider, or consultant at the time the services were performed, shall accept any commission, brokerage, or other valuable consideration for those services, unless the individual or business entity is licensed at the time the services were performed, if a license is required by law.
Terms Used In Kentucky Statutes 304.9-425
- agent: includes managing general agent unless the context requires otherwise. See Kentucky Statutes 304.9-085
- Business entity: means a corporation, association, partnership, limited liability company, limited liability partnership, employer group, professional employer organization, or other legal entity. See Kentucky Statutes 304.9-020
- Rental vehicle agent: means a business entity with a rental vehicle agent managing employee that is licensed to sell, solicit, or negotiate insurance offered, sold, or solicited in connection with, and incidental to, the rental of rental vehicles, whether at the rental office or by preselection of coverage in master, corporate, or group agreements that:
(a) Are nontransferable. See Kentucky Statutes 304.9-020 - Sell: means to exchange a contract of insurance by any means, for money or other valuable consideration, on behalf of an insurer. See Kentucky Statutes 304.9-020
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- State: when applied to a part of the United States, includes territories, outlying possessions, and the District of Columbia. See Kentucky Statutes 446.010
(3) This section shall not prevent payment or receipt of renewal or other deferred commissions to or by any individual or business entity entitled under this section.
(4) Services as an agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, or consultant within this state shall not include a referral by an unlicensed person of a consumer to a licensed agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, or consultant that does not include a discussion of specific insurance policy terms and conditions.
(5) An insurer, financial institution, agent, surplus lines broker, adjuster, administrator, reinsurance intermediary broker or manager, rental vehicle agent or managing employee, or consultant may pay any compensation, fee, or other consideration to an individual not licensed to sell insurance for the referral of a consumer to a licensed individual, only if the consideration is paid regardless of whether the insurance coverage is sold to the consumer.
Effective: June 25, 2013
History: Amended 2013 Ky. Acts ch. 123, sec. 2, effective June 25, 2013. — Amended
2010 Ky. Acts ch. 83, sec. 10, effective July 15, 2010. — Amended 2008 Ky. Acts ch.
32, sec. 18, effective July 15, 2008. — Amended 2002 Ky. Acts ch. 273, sec. 33, effective July 15, 2002. — Amended 2000 Ky. Acts ch. 393, sec. 31, effective July
14, 2000. — Created 1982 Ky. Acts ch. 171, sec. 6, effective July 15, 1982.
Legislative Research Commission Note (7/15/2008). 2008 Ky. Acts ch. 32 intended to change all existing references in the KRS from “viatical settlements” to “life settlements.” One reference to “viatical settlement” in this section was overlooked during the bill drafting process. The Reviser of Statutes has made this change upon the authority of KRS § 7.136(1)(h).