Final Answer:
Alex can determine whether this type of arrangement is acceptable 'by consulting the agency contract or agency agreement. It specifies the scope of the agent's authority and relationship with the insurance company'.
Step-by-step explanation:
The agency contract serves as the foundational document outlining the boundaries and permissions governing Alex's actions as an agent representing the insurance company. Within this agreement lies crucial information regarding permissible activities, such as offering payment plans to clients using external financing. Insurance companies often outline specific guidelines or prohibitions in their contracts to maintain control over risk exposure and financial practices.
For Alex, understanding the permissibility of financing premium payments is vital. Some insurance companies may allow such arrangements with designated financial institutions, ensuring compliance with their risk management strategies. By referencing this document, Alex gains insights into whether his proposal aligns with the company's regulations, preserving his agency's alignment with the insurer's policies and avoiding potential breaches of contract.
Correct answer: "By consulting the agency contract or agency agreement, which specifies the scope of the agent's authority and relationship with the insurance"