Getting ready to sit for my examinations and these questions popped into my head. Curious about the nuances of illegal inducement in these circumstances. I know there are issues with gifts greater than $100.

Can an insurance producer sell and collect premiums for a group insurance policy held by a church if he himself pays tithes to the church?

Can a CFP or other financial professional do business with a church if they regularly tithe or even give above through offerings as many wealthier members do?

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    Would there be any parallels between your scenarios and paying tax while doing business with the government?
    – Lawrence
    Oct 8, 2018 at 0:02
  • @Lawrence: No, it's not parallel or even reasonably close. You can't choose to divert your tax money to another worthy cause. While Christians may recognize an obligation to give a certain amount, the money is under the control of the giver, who has a large number of viable religious and charitable organizations to choose between. So it's not an involuntary payment like taxes, and there is no parallel. (Note that in practice, the choice of recipient provides a clean way to escape the appearance of a conflict of interest, but does not eliminate OP's need to know the rules)
    – Ben Voigt
    Oct 8, 2018 at 2:18
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    @Lawrence: A much better parallel would be donor-advised funds.
    – Ben Voigt
    Oct 8, 2018 at 2:19
  • @BenVoigt In both cases, the person makes a non-commercial payment to their prospective client. You make some good points, though. On donor-advises funds: these normally involve donors advising what to do with their own donations. I think the OP is more concerned about their situation looking like some kind of bribery.
    – Lawrence
    Oct 8, 2018 at 7:52
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    You can add another layer to the situation by having the insurance agent also run an advertisement in the church bulletin. Oct 8, 2018 at 11:14

1 Answer 1


The main thing that you need to worry about with insurance producers/agents is a practice called rebating - i.e. if you get a commission from selling an insurance policy it is illegal to share any part of the commission with the person receiving insurance coverage. This extends to any type of consideration (i.e. expensive pens, watches, prepaid vacations, etc...) and you typically see this scenario when someone has a $1m premium (and ~$100k to $150k in commission to the producer); a nice watch or other lavish gift doesn't seem that absurd in that case...

  • This appears to be a US-specific answer. I know that in the Netherlands, it's definitely not illegal. In fact, keeping such a commission is illegal when the insurance is considered a "complex financial product". It must be forwarded 100% to the customer.
    – MSalters
    Nov 30, 2020 at 11:54

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