2010 California Code :: Insurance Code :: Article 5. Unlawful Referrals (2024)

INSURANCE CODE
SECTION 750-754

750. (a) Except as provided in Section 750.5, any person actingindividually or through his or her employees or agents, who engagesin the practice of processing, presenting, or negotiating claims,including claims under policies of insurance, and who offers,delivers, receives, or accepts any rebate, refund, commission, orother consideration, whether in the form of money or otherwise, ascompensation or inducement to or from any person for the referral orprocurement of clients, cases, patients, or customers, is guilty of acrime. (b) A violation of subdivision (a) is punishable upon a firstconviction by imprisonment in the county jail for not more than oneyear, or by imprisonment in the state prison, or by a fine notexceeding fifty thousand dollars ($50,000), or by both thatimprisonment and fine. A second or subsequent conviction ispunishable by imprisonment in the state prison or by imprisonment inthe state prison and a fine of fifty thousand dollars ($50,000). (c) Nothing in this section shall prohibit a licensed collectionor lien agency from receiving a commission on the collection ofdelinquent debts nor prohibits the agency from paying its employees acommission for obtaining clients seeking collection on delinquentdebts. (d) Nothing in this section is intended to limit, restrict, or inany way apply to, the rebating of commissions by insurance agents orbrokers, as authorized by Proposition 103, enacted by the people atthe November 8, 1988, general election.750.4. Section 750 of the Insurance Code, Sections 3215 and 3219 ofthe Labor Code, and Section 549 of the Penal Code shall not apply toany person, corporation, partnership, association, or firm, that isoperating under both of the following circ*mstances: (a) On behalf of an insurer or self-insured person, company,association, or group. (b) Pursuant to, and within the scope of, a certificate of consentissued pursuant to Section 3702.1 of the Labor Code or pursuant to,and within the scope of, a license issued pursuant to Article 3(commencing with Section 14020) of Chapter 1 of Division 5.750.5. Nothing in Section 750 of the Insurance Code, Section 549 ofthe Penal Code, or Section 3215 of the Labor Code shall be construedto prevent an attorney or law firm from the following: (a) Dividing fees for legal services with a lawyer undercirc*mstances expressly permitted by Rule 2-200 of the Rules ofProfessional Conduct of the State Bar. (b) Offering or giving an incidental nonmonetary gift or gratuityto a person who has made a recommendation resulting in the employmentof the attorney or law firm, provided that the gift or gratuity wasnot offered in consideration of any promise, agreement, orunderstanding that the gift or gratuity would be forthcoming or thatreferrals would be made or encouraged in the future. (c) Offering or giving a bonus to an employee who has made areferral or recommendation resulting in the employment of theattorney or law firm, provided that the bonus was not offered inconsideration of any promise, agreement, or understanding that thebonus would be forthcoming or that referrals or recommendations wouldbe made or encouraged in the future.753. (a) It is unlawful for any insurance agent or broker, or anyinsurance solicitor employed thereby, to receive any financialbenefit from an automobile repair facility or any other form ofdirect or indirect consideration from any person for referringinsureds to that person or that person's designee for vehicle repairscovered under the automobile comprehensive coverage, property damagecoverage, or automobile collision coverage, of an insurance policyissued through the insurance agent or broker or by an insurerrepresented by the insurance agent. (b) Subdivision (a) applies with respect to commercial andnoncommercial policies of automobile insurance. (c) For purposes of this section, "financial benefit" means thereceiving of any commission or gratuity, discount on repair costs,free repairs, or employment by a repair facility.754. (a) It is unlawful for any person to solicit, receive, offer,or pay any referral fee for the referral of an individual for thefurnishing of services or goods for which the person knows or shouldhave known whole or partial reimbursem*nt is or may be made, directlyor indirectly, by any insurer. As used in this section, a referralfee is a fee paid by a person furnishing goods or services to anotherin return for the referral of an individual to that person for thefurnishing of services or goods. It includes any referral fee,kickback, bribe, or rebate, whether made directly or indirectly,overtly or covertly, or in cash or in kind. This subdivision does notapply to any of the following: (1) Discounts or similar reductions in prices. (2) Referral fees between attorneys if legal services are providedpursuant to a contingency fee arrangement if any referral fee isconsistent with the Rules of Professional Conduct of the State Bar ofCalifornia. (b) This section applies to all forms of insurance covering amotor vehicle, including commercial and personal lines, andcomprehensive coverage, property damage coverage, collision coverage,and liability coverage. (c) A violation of this section is a misdemeanor punishable by afine not to exceed one thousand dollars ($1,000) for each violation.Proceedings to enforce this section may be brought by any districtattorney or other prosecuting attorney.