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What is a Retail Incentive Program?

Is a referral incentive program legal?

  • Our agency has not done a great job in the past of asking for referrals. Part of that is because prior to last August the agency only consisted of my in-laws and they didn't have time to work on a lot of extra accounts. To help increase referrals we are getting ready to launch a referral incentive program that will run from now until the end of the year. Anyone that refers an account to us will receive a $15 gift card if we write the account. The store or restaurant for the gift card is yet to be determined. Is this legal or would it be considered rebating? This program would be available to all of our contacts. We are a property and casualty insurance agency in North Carolina. Thanks for your help.

  • Answer:

    Check out the article below from Jim Long. It sounds alright, but from the referrer's perspective, you might want to give them a gift card regardless since they have no control over the matter. Also qualifying what a referral is will increase the quality of the information you get - a personal note or phone call from referrer to the referred - not just a list of names and numbers. Email me if you are in the Raleigh area or East, I'd like to help more.

Paul K at Yahoo! Answers Visit the source

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I think this is a form of rebating, as you ONLY give the gift card if you write the account, AND, it's not like a "finders fee" that you only pay to licensed agents. That's my gut feeling - but check with your local agents association and get their feedback as well. Heck, call your state insurance department anonymously, and ask THEM.

mbrcatz

Some states have dollar limits ($10, $15 or $20). Check with your state's insurance department. They would much rather answer you now before you brake a law. I think North Carolina is strick with this stuff.

PJ

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