OAR 836-052-0156: Permitted Compensation Arrangements

(1) An issuer or other entity may provide commission or other compensation to an insurance producer or other representative for the sale of a Medicare supplement policy or certificate only if the first year commission or other first year compensation, including overrides and other sales-connected remuneration to field supervisory personnel, does not exceed 200 percent of the commission or the compensation paid for selling or servicing the policy or certificate in the second year or period. (2) The commission or other compensation to an insurance producer or other representative for the sale or renewal of a guaranteed issue Medicare supplement policy or certificate must be made on the same basis as for any other Medicare supplement policy or certificate. (3) The commission or other compensation provided in subsequent renewal years must be the same as that provided in the second year or period and must be provided for a reasonable number of renewal years. The total number of renewal years shall not be fewer than five renewal years. (4) An issuer or entity shall not provide compensation to its insurance producers and an insurance producer shall not receive compensation greater than the renewal compensation payable by the replacing issuer if an existing policy or certificate is replaced. (5) For purposes of this rule, "compensation" includes pecuniary or non-pecuniary remuneration of any kind relating to the sale or renewal of the policy or certificate, including but not limited to bonuses, gifts, prizes, awards and finder's fees. (6) Violation of this rule is an unfair trade practice under ORS 746.240.