State RegulationsCO specificDifficulty 2/5
A Colorado agency uses an unlicensed assistant who actively solicits and negotiates insurance applications. Under C.R.S. § 10-2-702, may the agency pay the assistant a commission for those sales?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
C.R.S. § 10-2-702(1) prohibits 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. The agency license of the employer does not cure the assistant's lack of licensure.
Why the other options are wrong
- A) Supervision by a licensed producer does not satisfy C.R.S. § 10-2-702; the person performing the services must have been licensed when they were performed.
- B) Licensing after the sale is too late; C.R.S. § 10-2-702 requires licensure at the time of the services, and no cure period exists.
- D) The agency's license does not extend to an unlicensed person who personally sells, solicits, or negotiates under C.R.S. § 10-2-702.
Memory hook
Licensed when it happened, or no commission — no retroactive fixes.