State RegulationsNY specificDifficulty 2/5
A New York producer's unlicensed friend regularly solicits Medicare supplement customers and asks to be paid a share of each commission. Under New York law, the producer:
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under the New York Insurance Law, compensating an unlicensed person for soliciting or selling insurance - or sharing commissions for that activity - is not a permitted compensation arrangement, and the Superintendent of Financial Services can discipline a producer who does it. Licensing exists to ensure that whoever persuades a consumer to buy insurance is qualified and accountable; routing payment to an unlicensed solicitor defeats that requirement.
Why the other options are wrong
- A) Who signs the paperwork does not matter; soliciting insurance is licensed activity, and being paid for it requires a license.
- B) An insurer's written agreement cannot authorize what the law forbids; the arrangement stays outside the permitted list.
- D) The medium of contact is irrelevant; soliciting insurance by any channel is licensed activity, and compensation for it requires a license.
Memory hook
No license, no commission - no exceptions.