Which statement is true regarding rebating of premiums?

The statement that rebating of premiums by insurance agents is prohibited is a crucial aspect of insurance regulations designed to ensure fair practices within the industry. Rebating refers to the practice of returning a portion of the premium paid by the policyholder as an incentive to purchase insurance. This practice can create an uneven playing field where certain agents might offer lower costs unlawfully to attract clients, potentially undermining the principles of integrity and fairness that the insurance market relies on.

Regulations around rebating are in place to protect consumers from deceptive practices and ensure they receive consistent value for insurance products. By prohibiting rebating, regulatory authorities aim to maintain standardization in policy costs and prevent agents from using potentially misleading financial incentives that could confuse or mislead consumers about the true value of insurance policies.

In this context, the other statements do not accurately reflect the standard practices or regulations. Authorizing rebating at a head office, identifying an insurer on letterhead, or acting for two insurers simultaneously are all subject to specific regulations and do not pertain directly to the outright prohibition of rebating practices. Therefore, the emphasis on the prohibition of rebating highlights the industry's commitment to ethical conduct and consumer protection.