What does rebating refer to in insurance practices?

Rebating in insurance practices specifically refers to the act of offering something of value to an applicant that is not detailed in the insurance contract itself. This might include cash, gifts, or other incentives provided to entice a potential policyholder to purchase insurance. Many states, including New Jersey, have laws against rebating as it can create an uneven playing field among insurance producers and lead to unethical sales practices. This definition clarifies that rebating does not relate to adjustments in premiums, coverage limits, or free consultations, which are all standard practices within the industry but do not fit under the legal definition of rebating.