State RegulationsOH specificDifficulty 3/5
A Youngstown producer offers every applicant a retail gift card as an inducement to buy a life policy, arguing that small promotional thank-you gifts are customary. Under Ohio's rebating rules, the offer is:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
ORC 3901.21(G) prohibits giving or offering any valuable consideration not specified in the contract as an inducement to purchase insurance. A gift card offered to induce a sale is exactly that, and the retrieved Ohio statute contains no de minimis dollar exception for promotional items, so the customary-practice argument fails. Knowingly accepting such a rebate is likewise prohibited, and violations can draw penalties under ORC 3901.22.
Why the other options are wrong
- B) There is no dollar threshold in Ohio's rebate ban; any valuable consideration beyond the contract used as an inducement is prohibited no matter how small.
- C) Disclosure and payment from commission do not legalize the inducement; the statute bans the consideration itself, not merely hidden payments.
- D) Insurer consent cannot override the statute; ORC 3901.21(G) applies to insurers, producers, and representatives alike regardless of internal approvals.
Memory hook
No gift-card loophole in Ohio — any inducement is a rebate.