Final answer:
An insurance agency offering a '10% off sale' on new insurance policies is committing unethical rebating, which is against regulations aimed at ensuring fair market practices and pricing structures. The legality depends on the jurisdiction, but it is generally considered unethical.
Step-by-step explanation:
An insurance agency that advertises a "10% off sale" on new insurance policies is engaging in what is considered unethical rebating. Rebating in the insurance industry involves returning a portion of the premium or giving a discount that is not stated in the policy itself, creating an unfair market practice. It is generally outlawed because it can result in a discriminatory pricing structure and undermines the competitive process.
Insurance regulations typically prohibit agents from providing rebates to customers as an inducement to purchase insurance. The idea behind this regulation is to maintain a level playing field among consumers and prevent potential conflicts of interest or deceptive practices.
Therefore, the correct answer here is likely option (d) - It is unethical rebating but it is not illegal, depending on the jurisdiction. Jurisdictions vary, and in some places, such practices may also be illegal. However, without clear information on the specific laws of the region in question, we can only conclude the practice is unethical.