State RegulationsNY specificDifficulty 1/5
A New York agent wants to send a client a gift to thank her for a recent policy purchase. Under N.Y. Ins. Law §2324, what is the maximum value of a gift an agent may give an insured or prospective insured, outside the advertising and charitable exceptions?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under N.Y. Ins. Law §2324(a)(1), an agent may not give anything of value to an insured or prospective insured as an inducement to purchase, subject only to a narrow exception for gifts of no more than $25 (and for advertising or charitable articles). The cap keeps competition focused on the merits of the coverage rather than on side benefits.
Why the other options are wrong
- B) $500 is the maximum penalty per rebating violation, not a permissible gift value.
- C) The 5% figure is the share of commission an agent may retain on the agent's own policies under §2324(f), not a gift allowance.
- D) The 10% figure is the controlled-business commission ceiling under §2103(i), not a basis for valuing gifts.
Memory hook
Gifts top out at $25 — a Jackson plus a Lincoln.