Life & Health · Chapter 20 · Agent Responsibilities
Commissions & Charges for Extra Services
Definition
No person may pay or accept commissions to/from an unlicensed individual for selling or negotiating insurance. Commission sharing is acceptable when both agents are licensed for the same lines of insurance. An individual no longer licensed may still receive residual commissions on policies sold while they WERE licensed. Charges for extra services are allowed only when the services and amounts are clearly outlined in a contract signed by both the client and the agent.
In plain English
Commissions flow only between licensed hands — and any extra fee needs the client's signature on paper first.
Exam tip
⚠️ Residual trap: an unlicensed person CAN collect renewals on old sales made while licensed — what's barred is commission on NEW business.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms