An Aurora agency pays a monthly bonus to an unlicensed marketing assistant who solicited several new life applications. Under C.R.S. § 10-2-702(1) and (2), what is the rule on paying that consideration?

Why D is correct

C.R.S. § 10-2-702(1) and (2) prohibit paying any commission, service fee, or other valuable consideration to a person for selling, soliciting, or negotiating insurance unless that person was a duly licensed producer at the time the services were performed. Supervision or later licensure does not cure the bar, and the narrow exceptions, such as assignment to the producer's own firm or renewal commissions to persons entitled, do not cover an unlicensed solicitor.

Why the other options are wrong

• A) Supervision by a licensed producer is not an exception; the statute requires the performer of the services to be licensed at the time.
• B) The license must exist when the services are performed; retroactive licensure cannot authorize the earlier payments.
• C) The prohibition reaches commissions, service fees, and any other valuable consideration, including bonuses tied to sales.

Memory hook

Pay only the licensed, at the time they worked, not after.