State RegulationsGA specificDifficulty 1/5
Under Georgia's unfair trade practices law, which of the following constitutes illegal rebating?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under O.C.G.A. § 33-6-4(b)(8)(B), it is unlawful to give or offer, directly or indirectly, rebates of premiums or any valuable consideration not specified in the contract as an inducement to purchase insurance. Returning part of the premium to close a sale distorts price competition and discriminates among similarly situated customers, so the Insurance Commissioner can sanction the practice even when the customer appears to benefit from the deal.
Why the other options are wrong
- B) Commissions paid to licensed agents are standard, contractually specified compensation for authorized producers, not rebates to policyholders.
- C) Refreshments at a group presentation where no applications are accepted fall within the statutory exceptions to the rebate ban.
- D) A bonus paid from surplus within the statutory exceptions is permitted; it is not premium returned to the customer as a purchase inducement.
Memory hook
Never give back premium to close the deal.