State RegulationsAZ specificDifficulty 1/5
Under A.R.S. 20-298, insurance commissions for selling insurance in Arizona may be paid to whom?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
A.R.S. 20-298 restricts the payment of commissions to persons properly licensed for the line of insurance involved. Commissions are compensation for transacting insurance, and since transacting requires a license under A.R.S. 20-282, an unlicensed person may not receive commission compensation for selling insurance no matter what role or title the person holds.
Why the other options are wrong
- B) Wrong because salaried status does not license anyone; A.R.S. 20-298 pays commissions only to properly licensed producers.
- C) Wrong because the insured's written designation cannot override the licensing requirement; commissions follow the license, not the applicant's wishes.
- D) Wrong because an officer's or director's corporate title confers no license; A.R.S. 20-298 keys commission eligibility to licensure.
Memory hook
Commissions follow the license — 20-298 pays only the licensed.