A Cincinnati agent offers a prospective client a cash rebate of part of the first-year premium as an inducement to purchase a policy. Under Ohio law, this is:

Why D is correct

ORC 3901.21(G) prohibits paying, offering, or giving any rebate of premiums payable on the policy, or any valuable consideration not specified in the contract, as an inducement to purchase insurance; for life coverage, ORC 3911.20 carries the same prohibition. Rebating is an unfair trade practice because it creates price advantages for favored customers that other insureds of the same class cannot obtain, and knowingly accepting a rebate is itself prohibited.

Why the other options are wrong

• A) Written disclosure does not legalize a premium rebate; the prohibition applies regardless of disclosure.
• B) The source of the rebate does not matter; a premium rebate offered as a purchase inducement is barred whether it comes from commission or elsewhere.
• C) Competitive price differences between insurers are addressed through rate and filing rules, not by requiring agents to rebate their commissions.

Memory hook

Cash back to close the sale = rebating = unfair practice in Ohio.