Section 1358.16 Of Article 3.5. Additional Requirements For Medicare Supplement Contracts From California Health And Safety Code >> Division 2. >> Chapter 2.2. >> Article 3.5.
1358.16
. (a) An issuer or other entity may provide a commission or
other compensation to a solicitor or other representative for the
sale of a Medicare supplement contract only if the first year
commission or other first year compensation is no more than 200
percent of the commission or other compensation paid for selling or
servicing the contract in the second year or period.
(b) The commission or other compensation provided in subsequent
renewal years shall be the same as that provided in the second year
or period and shall be provided for no fewer than five renewal years.
(c) No issuer shall provide compensation to a solicitor or
solicitor firm, and no solicitor or solicitor firm shall receive
compensation, greater than the renewal compensation payable by the
replacing issuer on renewal contracts if an existing contract is
replaced.
(d) For purposes of this section, "commission" or "compensation"
includes pecuniary or nonpecuniary remuneration of any kind relating
to the sale or renewal of the contract, including, but not limited
to, bonuses, gifts, prizes, awards, and finders' fees.