Disclosure is one of the quieter parts of referral compliance, but it's where a lot of trust — and a lot of legal protection — actually lives. Telling a customer plainly that you have a referral relationship and may be paid for the introduction costs you nothing and protects everyone. This is a plain-English overview and it is educational, not legal advice — disclosure requirements vary by state and by context, so confirm the specifics with your state Department of Insurance (DOI) or qualified counsel.
What is an insurance referral disclosure?
A referral disclosure is a clear statement to the customer that two things are true:
- A referral relationship exists between you and the insurer or agent you're introducing them to.
- You may receive compensation for making that introduction.
That's the core of it. A disclosure doesn't need to be long or legalistic — it needs to be honest, plain, and visible at the moment it's relevant. The point is that the customer isn't surprised later to learn you had a financial interest in the introduction.
It's also worth being clear about what a disclosure is not: it's not an endorsement, a guarantee, or a substitute for the licensed agent's role. You're disclosing the relationship, not advising on coverage.