House Bill NO. 1229

By Senator(s) Committee

SECTION 1. Section 83-17-7, Mississippi Code of 1972, is amended as follows:

83-17-7. It shall be unlawful for any insurance company or any insurance agent to pay, directly or indirectly, any commission, brokerage or other valuable consideration on account of any policy or policies written on risks in this state to any person, agent, firm or corporation not duly licensed as an insurance agent in this state, except that property and other risks of nonresident persons, and of foreign corporations not qualified in this state, may be insured by brokers or other agents duly licensed in other states.

It shall be lawful, however, for an insurance company or any insurance agent to pay, directly or indirectly, to the surviving spouse or heirs of a deceased licensed insurance agent in this state any commissions or other valuable consideration to which the deceased agent would be entitled, whether such surviving spouse or heir is or is not a licensed agent.

It shall be lawful for an insurance agent, agency or affiliate to pay a referral fee to any unlicensed employee of the agent, agency or affiliate when the employee refers a prospective insured to the licensed agent or agency. The referral fee shall be a one-time nominal fee of a fixed dollar amount for each referral customer; provided, however, that the fee shall not exceed Twenty Dollars ($20.00) per referral customer for commercial policies, Five Dollars ($5.00) per referral customer for homeowners policies, and Five Dollars ($5.00) per referral customer for personal auto policies. The Commissioner of Insurance shall establish by regulation the maximum amount of the referral fee for insurance products other than commercial, homeowners, and personal auto policies. The payment of any referral fee shall not depend on whether the referral results in a sale of any insurance products. Furthermore, the referral fee shall not be based on a percentage of any premiums or commissions collected by the licensed agent. The referral fee shall not be paid, either directly or indirectly, to the prospective insured.

The Commissioner of Insurance may promulgate rules and regulations necessary to carry out the provisions of this section.

For purposes of this section, the term "affiliate" means any entity or person who directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with, a specified entity or person.

SECTION 2. This act shall take effect and be in force from and after its passage.