All of the following are true regarding rebates EXCEPT which statement?

• A. Rebates are allowed if it's in the best interest of the client.
• B. Rebates are prohibited in Maryland.
• C. Rebates may be offered if disclosed to the Commissioner.
• D. Rebates are allowed if required by law.

Answer: (A)

Rebates in Maryland are generally not allowed because insurers and their agents cannot offer premium discounts or other gifts to influence a purchase or renewal of insurance. The idea that rebates are OK simply because it’s in the client’s best interest isn’t consistent with the rule— Maryland restricts inducements to buy insurance, even if the client stands to benefit.

The law does provide limited exceptions: rebates may be permitted if they’re disclosed to the Commissioner for approval, and rebates may be allowed when required by law or by statute. These are the narrow, defined situations where a rebate might occur, but they aren’t the default rule.

So this statement about rebates being allowed just because it’s in the client’s best interest is the one that isn’t true, while the other points reflect the lawful, restricted circumstances under which rebates may occur.