Texas Insurance Code 841.260 – Prohibited Commissions
(a) In this section, “contingent compensation” means a commission or other compensation an insurance company pays to a person that is contingent on:
(1) the writing or procurement of an insurance policy in the company;
(2) the procurement of an application for an insurance policy in the company;
(3) the payment of a renewal premium; or
(4) the assumption of an insurance risk by the company.
(b) A life insurance company that engages in the business of insurance in this state may not, directly or indirectly, pay or contract to pay a contingent compensation to:
(1) the president, vice president, secretary, or treasurer of the company;
(2) any other officer of the company, other than an agent or solicitor;
(3) an actuary of the company; or
(4) a medical director or other physician of the company whose duty is to examine risks or applications for insurance for the company.
Terms Used In Texas Insurance Code 841.260
- Contract: A legal written agreement that becomes binding when signed.
- Person: includes corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, and any other legal entity. See Texas Government Code 311.005
(c) This section does not prohibit a plan of compensation to a marketing officer according to the total amount of insurance the insurance company writes or to the total amount of insurance in force with the insurance company during a specified period if:
(1) the commissioner approves the plan under Subchapter A, Chapter 805;
(2) the marketing officer is not responsible for underwriting, rating, or otherwise approving the acceptability of insurance risks; and
(3) the plan does not compensate the marketing officer according to commissions on individual sales of any insurance product.