Which of the following actions is not considered rebating?

• A. Sharing commissions with other producers
• B. Offering a refund of part of the premium to a client
• C. Providing free services or gifts not specified in policy
• D. Paying for an applicant's travel to a seminar

Answer: (A)

Rebating is offering someone a value not specified in the policy as an inducement to purchase or to keep the policy. It targets the insured or applicant with something of value beyond the contract terms.

Sharing commissions with another producer does not provide a benefit to the applicant or insured; it’s simply compensation within industry practice among licensed producers. Since it doesn’t directly induce the client to buy or influence their decision with a benefit they receive, it isn’t considered rebating.

The other actions do involve giving value to the applicant or insured outside the policy terms (a premium refund, free services or gifts, or paying for travel to attend a seminar), which fits the definition of rebating.