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Rebating, Gifting, and Inducements

...how training helps compliance professionals make sense of a gray area.

I’m focusing here on the benefits of training for a specific compliance topic: rebates, gifts, and inducements. Why? Because it’s one of the hardest areas for compliance professionals to get their hands around, especially with any consistency or certainty. (Click here to read more about what training can do for compliance professionals and compliance functions.)

If you’ve spent even a short time working in insurance compliance, then you’ve probably answered the question of “Can we do this?” with “It depends…” This is probably even more true if you’re fielding questions about sales inducements.

While rebating is illegal in most states, there is much less consistency around the threshold of when something becomes a rebate, or how much money can be spent before exceeding limitations.

So, what can a discerning compliance professional do?

  1. Training and education. Learn what rebating is, how it can come up and why it’s problematic. But that’s not all, since it’s not possible to memorize each state’s various rules, what would serve you better is learning a framework to help you evaluate sales inducements. It won’t always mean a quick and easy answer, but having a process gives you clear markers of what to consider and think through before you can make a judgment call if something is allowable or not.
     
  2. Research Surveys. You can compile information about each state, or you can purchase a research survey. Here’s a sample of ours. A couple things to note there. First, researching each state’s rules and regulations is time consuming. The information can be found in various places that takes time to uncover and collect. Second, you’ll need to understand how often the information is updated. If you’re taking the DIY approach, what’s your process for ensuring it’s up to date? If you’ve found information or purchased a research survey, how often is it being updated? If you’re curious, our research survey is actively maintained, and those who have purchased it receive e-mail notification each time we record an update.

If you’re interested in learning more about rebates, gifting, and inducements, take a look at our Webinar replay on our education and training webpage.