Twice over the past summer, IIABNY reported that the New York Insurance Department has begun fining agencies for accepting referral gifts from auto glass repair shops, or for improperly supervising employees who accepted them. In the wake of the September disciplinary action report which listed another round of fines for this, the department has gone public. Newspapers and TV stations around the state picked up the story of insurance agents taking "kickbacks" for steering business to glass repair shops.
Now, I have a problem with the word "kickback" being applied to the act of accepting a mall gift card; "kickback" conjurs up images of cash passed in plain paper bags. I don't think a gift card is in the same league. Nevertheless, New York Insurance Law Sect. 322 makes it very clear that accepting any gifts from these shops is illegal; the department's pursuit of agencies that have done it should emphasize the point. While I would like to see the law amended so that it sets a dollar amount below which a gift is acceptable (should an agency be vulnerable to a fine for accepting donuts?), that's not what it says at this time. So, again, for the sake of your agency's balance sheet and its reputation, politely decline any proffered gifts from auto repair shops, and instruct your staffs to do likewise. Unless, that is, you too would like to see your agency's name in an Insurance Department press release.
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