California Insurance Code & EthicsQuestion 49 of 716
Which of the following describes rebating?
a.Sharing a commission with another licensed agent named as co-agent of record on the sale
b.Offering a group discount that was lawfully filed with the department in the rate plan
c.Reducing the premium due by applying dividends the policy has earned
d.Returning part of the agent's commission to the applicant as an inducement to buy
Explanation
Rebating is offering any valuable consideration outside the policy as an inducement to buy. California now permits limited, non-discriminatory rebates if disclosed and offered uniformly, but the textbook definition tested here is the unlawful inducement form.
Law Reference: Cal. Ins. Code §750This topic, taught in full in the California Life & Health Insurance Producer Exam guide. California Life & Health Insurance Producer Exam — Complete Study Guide (2026) — PDF + EPUB, $19.99 · 14-day refund →
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PrepPass team · Verified against California Life & Health Insurance License Exam · How we review
Reviewed by John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verify)