Laws about referral fees

[InsuranceJosh]

Can anyone tell me how to legally pay referral fees to non insurance agents? IE. Lawyers, CPAs or P&C agents

 

[David C]

Has an attorney, cpa, or p&c agent asked you for a referral fee? In my opinion this is not the thing to do. The professional advisors that I network with would be put off by this. And I would be put off if any of them asked for a referral fee.

I don't offer anyone a referral fee, I don't ask for a piece of the pie when I refer P&C to other agents, and they don't ask for a cut when they refer health, disability, or life business to me.

A referral fee is just not a good basis for a professional to professional relationship. Trust, likeability(is that a word?), and confidence that the other guy knows his stuff and will ALWAYS do the right thing - now those are good reasons to refer someone.

 

[Crabcake Johnny]

You can pay any amount for a referral but it cannot be contingent on the sale. But if you want to pay a certain dollar amount for referrals go have at it.

 

[InsuranceJosh]

Has an attorney, cpa, or p&c agent asked you for a referral fee? In my opinion this is not the thing to do. The professional advisors that I network with would be put off by this. And I would be put off if any of them asked for a referral fee.

I don't offer anyone a referral fee, I don't ask for a piece of the pie when I refer P&C to other agents, and they don't ask for a cut when they refer health, disability, or life business to me.

A referral fee is just not a good basis for a professional to professional relationship. Trust, likeability(is that a word?), and confidence that the other guy knows his stuff and will ALWAYS do the right thing - now those are good reasons to refer someone.

A guy I know would pay Brokers(investment) 50% first year commissions. And this is how he would get alot of referrals.

He worked with alot of brokers doing this so he could not pay them be in referrals.

Now these brokers also had there L&H so this was ok to do.

 

[arnguy]

Shhhhh......cash only!

 

[bluemarlin08]

I send prepaid gas cards or restaurant gift cards to clients that refer folks to me, the amount is based on the case. Recently had a doc client refer an associate to me and I sent him a gift card to Ruth's Chris.

 

[saieddie]

In Virginia, you can only pay up to $25 for referrals to people who aren't licensed. It can't be contingent on the sale either.

LIS > Code of Virginia > 38.2-1821.1

 

[senior-advisor-indiana]

In Virginia, you can only pay up to $25 for referrals to people who aren't licensed. It can't be contingent on the sale either.

LIS > Code of Virginia > 38.2-1821.1

I have heard the same about Indiana. I beleive that if you have to pay for a referral then it is not a referral.

 

[TheSalesWolf]

I give out $25 gift cards for referrals that get approved.

 

[James]

In Virginia, you can only pay up to $25 for referrals to people who aren't licensed. It can't be contingent on the sale either.

LIS > Code of Virginia > 38.2-1821.1

8. Any person who refers a customer who seeks to purchase any insurance product to a licensed agent and receives compensation for the referral of a customer, provided that:
a. The referral does not include a discussion of specific insurance policy terms and conditions;
b. The compensation is in the form of a one-time nominal fee of a fixed dollar amount for each referral; and
c. The compensation does not depend on whether the referral results in the purchase of insurance by the customer.

Depends upon what you call Nominal? Yet I know of Lead Companies that charge well over $100 a lead for a Lead that would be nothing more then a referral. Really there isn't a per say dollar amount restriction for the price of a lead/referral, which is one of the same.