Personal Commercial Solicitation on DoD Installations, 38760-38770 [E6-10360]

Agencies

• Office of the Secretary
• DEPARTMENT OF DEFENSE

[Federal Register Volume 71, Number 131 (Monday, July 10, 2006)]
[Rules and Regulations]
[Pages 38760-38770]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-10360]


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DEPARTMENT OF DEFENSE

Office of the Secretary

[DoD-2006-OS-0065]

32 CFR Parts 43 and 50

RIN 0790-AH87


Personal Commercial Solicitation on DoD Installations

AGENCY: Department of Defense, Office of the Secretary of Defense.

ACTION: Final rule.

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SUMMARY: This rule amends and removes the Department regulations 
relating to policy and procedures on personal commercial solicitation 
on DoD installations. It incorporates current policy letters that were 
issued since the last publication of the regulations in February 1986. 
They include policy on use of on-base financial institutions and non-
profit, tax exempt, private organizations to provide financial 
education; limits on the use of commercial sponsorship to obtain 
personal contact information for solicitation; and required reporting 
of solicitation policy violations to higher headquarters. The revision 
also includes a new solicitation evaluation form to help installations 
detect solicitation policy violations.

DATES: Effective Date: July 10, 2006.

FOR FURTHER INFORMATION CONTACT: Colonel Michael A. Pachuta or Mr. 
James M. Ellis at (703) 602-4994 or (703) 602-5009 respectively, or 
main (703) 602-5001.

SUPPLEMENTARY INFORMATION: On Tuesday, April 19, 2005 (70 FR 20316), 
the Department of Defense published a proposed rule. The following is a 
summary of substantive comments, whether or not they were accepted or 
rejected, and the rationale.
    Comment 1: DepSecDef Memo, DoD Instructions Review--Phase II 
directed, where feasible, to change Directives not requiring the SECDEF 
or DEPSEC signature to Instructions.
    Decision: Accepted. 1344.7 does not meet the DepSecDef's criteria 
to remain a DoD Directive and will be reissued as a DoD Instruction.

[[Page 38761]]

    Comment 2: Two civilians recommended all on-post insurance 
solicitation be banned.
    Decision: Rejected: The purpose of the Instruction is not to 
prohibit insurance solicitation but to prevent unfair and predatory 
sales practices.
    Comment 3: The American Council of Life Insurers recommends the 
solicitation office supervisor send a copy of each solicitation 
evaluation form received to each registered company or company the 
solicitor represents.
    Decision: Rejected: The solicitation evaluation form is an internal 
feedback tool to assess how the solicitation was performed. The agent 
or company may request a copy by submitting a Freedom of Information 
Act request.
    Comment 4: A Marine Corps Captain recommends an on-base entity, 
such as a civil law officer from base legal office, screen insurance 
sales personnel seeking base access.
    Decision: Accepted. Para 6.2.2. now states: ``Commanders will 
ensure the agent's license status and complaint history are checked 
with the appropriate state or federal regulators prior to granting 
permission to solicit on the installation.''
    Comment 5: Military Benefits Association believes DD Form 2885 
(solicitation evaluation) is biased, recommends it be rewritten to 
remove any propensity to evoke a critical response, and a copy of 
submitted forms should be provided to both the agent and insurer.
    Decision: Rejected. The questions are balanced and necessary to 
determine whether or not the solicitor complied with DoD commercial 
solicitation policy. The commander has the discretion to provide the 
agent and insurer a copy of the form. The agent or insurer can also 
request a copy of completed forms under the Freedom of Information Act.
    Comment 6: Government Personnel Mutual Life Insurance recommends DD 
Form 2885 (solicitation evaluation) be made available to the company 
the salesman represents.
    Decision: Rejected. The commander should have the discretion to 
provide the form to the company when it is appropriate to do so. The 
agent or company can request a copy of completed forms under the 
Freedom of Information Act.
    Comment 7: United Services Automobile Association recommends DoD 
prohibit solicitation of all trainees as well as solicitation of any 
DoD personnel in a mass or captive audience.
    Decision: Accepted. The current policy prohibits solicitation of 
recruits, trainees and transient personnel in a mass audience, which is 
appropriate to protect the most junior and inexperienced DoD personnel 
from potential chain of command and peer pressure associated with such 
a solicitation. The new policy prohibits solicitation of any DoD 
personnel in a captive audience where their attendance is not 
completely voluntary.
    Comment 8: First Command requested clarification of ``on-duty 
status'' and to exclude meal times from being considered ``duty time'' 
for the purposes of prohibiting solicitation.
    Decision: Partially accepted. If the purpose of the on-base meal 
time meeting is to seek business or trade, it is considered 
solicitation. To clarify, we expanded the definition of Personal 
Commercial Solicitation in paragraph E2.1.15. as follows: ``Personal 
contact, to include meetings, meals or telecommunications contact, for 
the purpose of seeking private business or trade''.
    Comment 9: Military Benefits Association agrees that rosters and 
other official lists should not be used for solicitation; however, they 
believe there are many legitimate sources, i.e., telephone directories, 
the Internet, and commercially available mailing lists, the procurement 
of which should not be a violation of DoD policy.
    Decision: Accepted. We rewrote paragraph 6.4.5. to clarify that it 
is prohibited to procure ``non-public listings'' of DoD personnel for 
the purpose of solicitation. Note: DoD telephone directories are ``For 
Official Use Only'' and are considered ``non-public listings''.
    Comment 10: The American Council of Life Insurers recommends 
paragraph 6.4.5. be changed to clarify that it is permitted to procure 
``listings created by or obtained from public information such as e.g., 
telephone directories, government records other than Defense Department 
records, and newspapers'' for the purpose of solicitation. ACLI further 
recommends DoD clarify that: ``Public information can be utilized for 
the purposes of commercial solicitation of Service members as long as 
the listing is not directly for DoD personnel or in a manner that would 
be disruptive to the mission of the Military Departments.''
    Decision: Accepted. We rewrote paragraph 6.4.5. to clarify it is 
prohibited to procure ``non-public listings'' of DoD personnel for the 
purpose of solicitation.
    Comment 11: Military Benefits Association recommends that 
contacting DoD personnel via a government phone should not be a DoD 
policy violation if the DoD member provided the number or if the agent 
did not know it was a government phone.
    Decision: Accepted. The new policy does not consider solicitor 
contact via a government phone a violation if a pre-existing 
relationship exists between the parties. We have expanded paragraph 
6.4.15. to clarify that a pre-existing relationship means the DoD 
member is a current client and did not request contact to be 
terminated.
    Comment 12: Office of the Connecticut State Attorney General 
recommends the list of grounds that may result in denial, suspension, 
or withdrawal of solicitation privileges should also include ``any 
violations of the law of the state in which the base is located.''
    Decision: Accepted. Added to the end of paragraph 6.5.1.1.
    Comment 13: First Command recommends SF 1199A (direct deposit sign-
up form) be included in the definition of allotment forms solicitors 
are prohibited to possess.
    Decision: Accepted. Added to paragraph 6.5.1.6.
    Comment 14: A Marine Corps Captain recommends rewording paragraph 
6.5.1.6. to include: ``The possession of and any attempt to obtain 
supplies of allotment forms used by military departments, or possession 
or use of facsimiles thereof. This includes using a Service members 
``MyPay'' account or other similar internet medium for the purpose of 
establishing a direct deposit for the purchase of insurance or other 
investment product.''
    Decision: Accepted. Added to paragraph 6.5.1.6.
    Comment 15: The National Association of Insurance Commissioners 
recommends reporting all complaints involving insurance products be 
reported immediately to the appropriate state insurance department.
    Decision: Accepted. Expanded paragraph 6.5.4. to require commanders 
to immediately report agents, companies or products that fail to meet 
state or regulatory requirements to the appropriate regulatory 
authorities.
    Comment 16: Trans World Assurance recommends the ``show cause'' 
requirement in the current version of DoD Directive 1344.7 be retained 
in the new Instruction.
    Decision: Accepted. Paragraph 6.5.5. was rewritten to restore the 
``show cause'' requirement.
    Comment 17: A Government Accountability Office audit recommends: 
``the SecDef direct the USD(P&R) to specify in the revised Directive 
that the installation commander is responsible for notifying

[[Page 38762]]

state insurance regulators, the Service Secretariat and DoD, when the 
commander has determined that agents or companies have violated DoD, 
Service, or installation policies.''
    Decision: Partially accepted. Not all DoD personal commercial 
solicitation policy violations, such as soliciting without an 
appointment or soliciting during duty hours, are not violations of 
State or Federal law and would be of no interest to State and Federal 
insurance and financial product regulators. Paragraph 6.5.5. was 
rewritten to require installations to report violations that involve 
the eligibility of the agent to hold a state license or meet regulatory 
requirements, complaints involving the quality, suitability or 
marketing methods, or if an agent or company is barred or suspended, to 
the appropriate state or federal regulatory authorities.
    Comment 18: A civilian recommends DoD require reporting of abusive 
market conduct (deceptive sales practices) to State insurance 
regulators.
    Decision: Accepted. Added this requirement to paragraph 6.5.5.
    Comment 19: A Government Accountability Office audit recommended 
the SecDef direct USD(P&R) to develop and implement, with the Services, 
a DoD-wide searchable violations database that uses consistent data 
elements and coding across Services in revising DoD's solicitation 
regulation.
    Decision: Partially accepted. The Department has developed a DoD-
wide list of current enforcement actions and posted it on the DoD 
Commanders Page Web site https://www.commanderspage.com. Paragraph 
6.5.6. was expanded to include the requirement for installations to 
report denial, suspension, or withdrawal of solicitation privileges to 
PDUSD(P&R) so that information can be included on this list. The 
Department believes maintaining a list, which includes violations that 
do not result in denial, suspension, or withdrawal of solicitation 
privileges, would dilute the validity and utility of the list.
    Comment 20: The American Council of Life Insurers recommends DoD 
guidance found in Title 32 at 43.6(e)(2)(vi) be maintained to assure 
that, as a matter of due process, the lifting of a denial or withdrawal 
is communicated effectively to every office and Department.
    Decision: Accepted. Expanded paragraph 6.5.7. to require 
PDUSD(P&R), the Military Departments, and appropriate State and Federal 
regulatory agencies are notified when suspensions or withdrawals are 
lifted.
    Comment 21: American Fidelity Life Insurance Company recommends the 
discontinuance of the use of ``off limits'' sanctions by the Armed 
Forces Disciplinary Control Board (AFDCB).
    Decision: Rejected. The long-standing DoD policy contained in 
paragraph 6.5.8. authorizes the Secretaries of the Military Departments 
to direct Armed Forces Disciplinary Control Boards to consider 
applicable information for withdrawal of solicitation privileges and 
take action the Boards deem appropriate. One action the Boards may deem 
appropriate is to place an off-base establishment ``off-limits'' to 
military personnel. That authority must remain available to Commanders 
as a means to protect the health, morale and welfare of their 
personnel.
    Comment 22: The National Association of Insurance Commissioners 
recommends DoD prohibit the display of sales material by solicitors 
since such a display may be interpreted as an endorsement of a 
company's products.
    Decision: Rejected. Paragraph 6.6.4. gives the installation 
commander the discretion to permit the display of sales literature in 
designated locations. Commanders must ensure compliance with the Joint 
Ethics Regulation, which regulates DoD endorsement of non-federal 
entities.
    Comment 23: The Defense Credit Union Council praised DoD for 
including a prohibition in paragraph 6.6.4. to prohibit off-base banks 
and credit unions from distributing competitive literature or forms 
which mirrors guidance contained in Volume 5, Chapter 34 of the DoD 
Financial Management Regulation.
    Decision: Accepted. Added to para 6.6.4.
    Comment 24: The Defense Credit Union Council recommends adding 
language to ensure sales representatives possess the necessary 
credentials (securities licenses and certifications) to provide 
financial education and advice.
    Decision: Partially accepted. Long-standing DoD policy precludes 
commercial agents from providing financial education. However, we added 
a requirement in paragraph 6.2.2. to check insurance and financial 
product solicitor's license and complaint history.
    Comment 25: The Military Benefits Association recommends financial 
counseling be provided by trained certified personnel, should include 
information on a wide-range of commercial products and not simply be 
reinforcement for SGLI.
    Decision: Rejected. Paragraph 6.7.1. identifies a wide-range of 
financial counseling topics and paragraph 6.7.2. requires the Military 
Departments to ensure financial counselors are qualified.
    Comment 26: The Defense Credit Union Council recommends on-base 
banks and credit unions be required to provide financial education and 
training.
    Decision: Partially accepted. Paragraph 6.7.5. of the Instruction 
advises Commanders that on-base banks and credit unions are required to 
provide financial counseling services as part of their financial 
services offerings but does not mandate their use.
    Comment 27: The American Fidelity Insurance Company recommends on-
base banks and credit unions not be given preferential treatment in 
providing financial education classes.
    Decision: Rejected. The draft policy does not mandate the use of 
on-base banks and credit unions to provide financial education and 
mirrors guidance already contained in the DoD Financial Management 
Regulation.
    Comment 28: The American Council of Life Insurers recommends all 
financial services professionals, including insurance producers and 
carriers, be allowed to demonstrate their professional qualifications 
and ability to provide objective financial counseling services to 
military service personnel. Or alternatively, that DoD use the services 
offered by the Life and Health Insurance Foundation for Education 
(https://www.life-line.org) or the National Association of Insurance 
Commissioners or by the state where a military installation is located 
to provide financial counseling services.
    Decision: Partially accepted. Long-standing DoD policy prohibits 
the use of commercial agents to provide financial education to DoD 
personnel. If the other non-governmental organizations, such as the 
Life and Health Insurance Foundation or the National Association of 
Insurance Commissioners qualify as 501(c) 3 or 501(c) 23 organizations, 
the Military Departments can approve them to provide financial 
education in accordance with paragraph 6.7.6.3.
    Comment 29: The Military Officers Association of America recommends 
the Military Departments be authorized to approve IRS category 501(c) 
19 organizations to conduct military benefits and financial education 
briefings to DoD personnel, that IRS category 501(c) 23 organizations 
are permitted to provide.
    Decision: Rejected. By law, the principal purpose of 501(c) 23 
organizations must be to provide insurance and other benefits to 
veterans and their dependents. 501(c) 19 organizations must be operated 
for one

[[Page 38763]]

or more of eight purposes, which may or may not include providing 
insurance benefits for its members or their dependents.
    Comment 30: The National Association of Insurance Commissioners 
recommends DoD include the NAIC's informational brochure ``Life 
Insurance for Military Personnel'' in any education program.
    Decision: Partially accepted. The NAIC's brochure could be made 
available for use if the NAIC qualifies as a 501(c) 3 tax exempt 
organization and secures a memorandum of agreement to become a DoD 
financial education partner. The Department and NAIC have drafted an 
MOU to permit use of this brochure in military financial education 
classes.
    Comment 31: First Command recommends DoD delete: ``personal 
computer banking'' from the definition of ``Financial Services'' in 
Enclosure 2 or add: ``other financial institutions can provide personal 
computer banking as long as access can be made via computer and/or 
internet.''
    Decision: Accepted. Deleted ``and personal computer banking'' from 
parenthetical intended to elaborate on the meaning of ``electronic 
banking'' in paragraph E2.1.8.
    Comment 32: The National Association of Insurance Commissioners 
recommends the definition of ``insurer'' be changed to: ``an entity 
licensed by the appropriate department to engage in the business of 
insurance.''
    Decision: Accepted. Incorporated into paragraph E2.1.12.
    Comment 33: The District of Columbia Government Department of 
Insurance, Securities and Banking recommends the definition of 
``Solicitation'' be stated in the disjunctive rather than the 
conjunctive to avoid ambiguity.
    Decision: Accepted. We revised the definition of ``Personal 
Commercial Solicitation'' in paragraph E2.1.15. and eliminated all 
``conjunctive ambiguities.''
    Comment 34: First Command recommends changing the definition of 
``Solicitation'' to: ``The act of offering a product of service for 
sale by a private business including the offering and sale of insurance 
or securities on a military installation.''
    Decision: Rejected. Although these words are in the current 
Directive's definition of Solicitation, they focus more on what is sold 
versus how something is sold. Solicitation concerns how something is 
sold versus what is sold. Therefore, we rewrote the definition in 
paragraph E2.1.15. to focus the definition of ``Personal Commercial 
Solicitation'' on how something is sold.
    Comment 35: First Command recommends letting the insurance policy 
suffice as a written description for each product or service the 
companies intend to market to DoD personnel.
    Decision: Partially accepted. Deleted the word ``separate'' before 
``written description for each product or service'' in paragraph E3.1. 
so the policy itself could meet the ``written description requirement'' 
if all other subsequent prerequisite requirements outlined in this 
paragraph are met.
    Comment 36: The National Association of Insurance Commissioners 
recommends adding the following to paragraph E3.1.: ``Companies should 
be able to demonstrate that each form to be used has been approved, 
where applicable, by the insurance department in which the state is 
located''.
    Decision: Accepted. Added to paragraph E3.1.
    Comment 37: Office of the Connecticut Attorney General recommended 
any insurance product offered for sale by a commercial solicitor must 
be filed with the insurance commissioner of the state in which the 
installation is located.
    Decision: Accepted. Added the following to paragraph E3.1: 
``Companies should be able to demonstrate that each form to be used has 
been approved, where applicable, by the insurance department of the 
state where the installation is located. Insurance products solicited 
to DoD personnel on overseas installations must conform to the 
standards prescribed by the laws of the state where the company is 
incorporated.''
    Comment 38: First Command recommends DoD prohibit whole life 
policies with restrictive clauses.
    Decision: Rejected. Paragraph E3.1.1.2. requires insurance products 
sold on DoD installations: ``contain no restrictions by reason of 
military service or military occupational specialty of the insured, 
unless such restrictions are clearly indicated on the face of the 
contract''.
    Comment 39: A Marine Corps Captain recommends having companies that 
sell life insurance have Service members sign a form acknowledging they 
clearly understand SGLI, and its cost and coverage.
    Decision: Accepted. Added paragraph E3.1.1.5. to include a 
requirement to inform Service members in writing of the cost and 
availability of government subsidized insurance.
    Comment 40: First Command recommends DoD allow annuity contracts to 
be used to satisfy the requirements in para E3.1.4. for an agent to 
provide the customer written documentation, which clearly shows how 
much of the premium for an insurance product with a savings component 
is allocated to savings and how much is allocated to insurance premiums 
per year over the life of the policy.
     Decision: Accepted. Nothing in the instruction specifically 
precludes using the annuity contract to fulfill this requirement.
    Comment 41: A private citizen recommends prohibiting allotments 
from military paychecks.
    Decision: Rejected. Allotments are for the member's convenience and 
help ensure financial obligations will still be met when they deploy.
    Comment 42: A Government Accountability Office audit recommends 
SecDef direct the USD(P&R) to clarify the portion of the revised 
Directive that pertains to the cooling off period that must elapse 
before junior enlisted personnel can start as an allotment to purchase 
supplemental life insurance.
    Decision: Accepted. Paragraph E3.3.2. was rewritten as follows to 
make this clarification: ``For personnel in pay grades E-4 and below, 
in order to provide an opportunity to obtain financial counseling, at 
least seven calendar days shall elapse between the signing of a life 
insurance application and the certification of a military pay allotment 
for any supplemental commercial life insurance. Installation Finance 
Officers are responsible for ensuring this seven-day cooling-off period 
is monitored and enforced. The purchaser's commanding officer may grant 
a waiver of the seven-day cooling-off period requirement for good 
cause, such as the purchaser's imminent deployment or permanent change 
of station''.
    Comment 43: The American Council of Life Insurers recommends DoD 
require insurers to be members of the Insurance Marketplace Standards 
Association (IMSA) in order to be eligible to solicit insurance on DoD 
installations.
    Decision: Rejected. Although requiring IMSA membership would be 
desirable, the Joint Ethics Regulation prohibits this type of federal 
endorsement of a non-federal entity and IMSA membership would not 
necessarily guarantee compliance with DoD policies and IMSA membership 
also requires payment of a substantial fee.
    Comment 44: The American Council of Life Insurers recommends DoD 
delete

[[Page 38764]]

the restriction that insurance agents and general agents approved to 
solicit on overseas DoD installations may only represent one registered 
commercial insurance company.
    Decision: Rejected. Paragraph E4.3.2. allows this restriction to be 
waived by the overseas commander if in the best interests of DoD 
personnel.

Executive Order 12866, ``Regulatory Planning and Review''

    It has been determined that 32 CFR part 50 is not a significant 
regulatory action. The rule does not:
    (1) Have an annual effect to the economy of $100 million or more or 
adversely affect in a material way the economy; a section of the 
economy; productivity; competition; jobs; the environment; public 
health or safety; or State, local, or tribal governments or 
communities;
    (2) Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another Agency;
    (3) Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs, or the rights and obligations of 
recipients thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive Order.

Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35)

    Section B of Appendix B to this rule contains information 
collection requirements. As required by the Paperwork Reduction Act (44 
U.S.C. Chapter 35), DoD has submitted an information clearance package 
to the Office of Management and Budget for review. In response to DoD's 
invitation to comment on any potential paperwork burden associated with 
this rule (70 FR 28514-28515), no comments were received. However, one 
favorable comment was forwarded to the Office of Management and Budget 
during the 30-day review period (71 FR 29319).

Federalism (Executive Order 13132)

    This regulatory action does not have federalism implications, as 
set forth in Executive Order 13132. It will not have substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government.

Public Law 96-354, ``Regulatory Flexibility Act'' (5 U.S.C. Chapter 6)

    It has been certified that this rule is not subject to the 
Regulatory Flexibility Act (5 U.S.C. 601) because it would not, if 
promulgated, have a significant economic impact on a substantial number 
of small entities.

Section 202, Public Law 104-4, ``Unfunded Mandates Reform Act''

    It has been determined that this rule does not involve a Federal 
mandate that may result in the expenditure by State, local and tribal 
governments, in the aggregate, or by the private sector, of $100 
million or more and that such rulemaking will not significantly or 
uniquely affect small governments.

List of Subjects in 32 CFR Parts 43 and 50

    Consumer protection, Federal buildings and facilities, Government 
employees, Life insurance, Military personnel.


0
Accordingly, 32 CFR Chapter I, subchapter D is proposed to be amended 
as follows:

PART 43--[REMOVED]

0
1. Part 43 is removed.

0
2. Part 50 is added to read as follows:

PART 50--PERSONAL COMMERCIAL SOLICITATION ON DOD INSTALLATIONS

General Provisions

Sec.
50.1 Purpose.
50.2 Applicability.
50.3 Definitions.
50.4 Policy.
50.5 Responsibilities.
50.6 Procedures.
50.7 Information requirements.
Appendix A to Part 50--Life Insurance Products and Securities.
Appendix B to Part 50--Overseas Life Insurance Registration Program.

    Authority: 5 U.S.C. 301.

General Provisions


Sec.  50.1  Purpose.

    This part:
    (a) Implements section 577 of Public Law No. 109-163 (2006) and 
establishes policy and procedures for personal commercial solicitation 
on DoD installations.
    (b) Continues the established annual DoD registration requirement 
for the sale of insurance and securities on DoD installations overseas.
    (c) Identifies prohibited practices that may cause withdrawal of 
commercial solicitation privileges on DoD installations and establishes 
notification requirements when privileges are withdrawn.
    (d) Establishes procedures for persons solicited on DoD 
installations to evaluate solicitors.
    (e) Prescribes procedures for providing financial education 
programs to military personnel.


Sec.  50.2  Applicability.

    This part:
    (a) Applies to the Office of the Secretary of Defense, the Military 
Departments, the Chairman of the Joint Chiefs of Staff, the Combatant 
Commands, the Office of the Inspector General of the Department of 
Defense, the Defense Agencies, the DoD Field Activities, and all other 
organizational entities in the Department of Defense (hereafter 
referred to collectively as the ``DoD Components'').
    (b) Does not apply to services furnished by residential service 
companies, such as deliveries of milk, laundry, newspapers, and related 
services to personal residences on the installation requested by the 
resident and authorized by the installation commander.
    (c) Applies to all other personal commercial solicitation on DoD 
installations. It includes meetings on DoD installations of private, 
non-profit, tax-exempt organizations that involve commercial 
solicitation. Attendance at these meetings shall be voluntary and the 
time and place of such meetings are subject to the discretion of the 
installation commander or his or her designee.


Sec.  50.3  Definitions.

    Agent. An individual who receives remuneration as a salesperson or 
whose remuneration is dependent on volume of sales of a product or 
products. (Also referred to as ``commercial agent'' or ``producer''). 
In this part, the term ``agent'' includes ``general agent'' unless the 
content clearly conveys a contrary intent.
    ``Authorized'' Bank and/or Credit Union. Bank and/or credit union 
selected by the installation commander through open competitive 
solicitation to provide exclusive on-base delivery of financial 
services to the installation under a written operating agreement.
    Banking institution. An entity chartered by a State or the Federal 
Government to provide financial services.
    Commercial sponsorship. The act of providing assistance, funding, 
goods, equipment (including fixed assets), or services to an MWR 
program or event by an individual, agency, association, company or 
corporation, or other entity (sponsor) for a specified (limited) period 
of time in return for public recognition or advertising promotions. 
Enclosure 9

[[Page 38765]]

of DoD Instruction 1015.10 \1\ provides general policy governing 
commercial sponsorship.
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    \1\ Copies may be obtained at https://www.dtic.mil/whs/
directives/.
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    Credit union. A cooperative nonprofit association, incorporated 
under the Credit Union Act (12 U.S.C. 1751), or similar state statute, 
for the purpose of encouraging thrift among its members and creating a 
source of credit at a fair and reasonable rate of interest.
    DoD installation. For the purposes of this part, any Federally 
owned, leased, or operated base, reservation, post, camp, building, or 
other facility to which DoD personnel are assigned for duty, including 
barracks, transient housing, and family quarters.
    DoD personnel. For the purposes of this part, all active duty 
officers (commissioned and warrant) and enlisted members of the 
Military Departments and all civilian employees, including 
nonappropriated fund employees and special Government employees, of the 
Department of Defense.
    Financial services. Those services commonly associated with 
financial institutions in the United States, such as electronic banking 
(e.g., ATMs), in-store banking, checking, share and savings accounts, 
fund transfers, sale of official checks, money orders and travelers 
checks, loan services, safe deposit boxes, trust services, sale and 
redemption of U.S. Savings Bonds, and acceptance of utility payments 
and any other consumer-related banking services.
    General agent. A person who has a legal contract to represent a 
company. See the definition of ``Agent'' in this section.
    Insurance carrier. An insurance company issuing insurance through 
an association reinsuring or coinsuring such insurance.
    Insurance product. A policy, annuity, or certificate of insurance 
issued by an insurer or evidence of insurance coverage issued by a 
self-insured association, including those with savings and investment 
features.
    Insurer. An entity licensed by the appropriate department to engage 
in the business of insurance.
    Military services. See Joint Publication 1-02, ``DoD Dictionary of 
Military and Associated Terms.'' \2\
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    \2\ See https://www.dtic.mil/doctrine/jel/doddict/indexs.html.
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    Normal home enterprises. Sales or services that are customarily 
conducted in a domestic setting and do not compete with an 
installation's officially sanctioned commerce.
    Personal commercial solicitation. Personal contact, to include 
meetings, meals, or telecommunications contact, for the purpose of 
seeking private business or trade.
    Securities. Mutual funds, stocks, bonds, or any product registered 
with the Securities and Exchange Commission except for any insurance or 
annuity product issued by a corporation subject to supervision by State 
insurance authorities.
    Suspension. Temporary termination of privileges pending completion 
of a commander's inquiry or investigation.
    Withdrawal. Termination of privileges for a set period of time 
following completion of a commander's inquiry or investigation.


Sec.  50.4  Policy.

    (a) It is DoD policy to safeguard and promote the welfare of DoD 
personnel as consumers by setting forth a uniform approach to the 
conduct of all personal commercial solicitation and sales to them by 
dealers and their agents. For those individuals and their companies 
that fail to follow this policy, the opportunity to solicit on military 
installations may be limited or denied as appropriate.
    (b) Command authority includes authority to approve or prohibit all 
commercial solicitation covered by this part. Nothing in this part 
limits an installation commander's inherent authority to deny access to 
vendors or to establish time and place restrictions on commercial 
activities at the installation.


Sec.  50.5  Responsibilities.

    (a) The Principal Deputy Under Secretary of Defense for Personnel 
and Readiness (PDUSD(P&R)), under the Under Secretary of Defense for 
Personnel and Readiness, shall:
    (1) Identify and publish policies and procedures governing personal 
commercial solicitation on DoD installations consistent with the policy 
set forth in this part.
    (2) Maintain and make available to installation commanders and 
appropriate Federal personnel the current master file of all individual 
agents, dealers, and companies who have their privileges withdrawn at 
any DoD installation.
    (3) Develop and maintain a list of all State Insurance 
Commissioners' points of contact for DoD matters and forward this list 
to the Military Services.
    (b) The Heads of the DoD Components shall:
    (1) Ensure implementation of this part and compliance with its 
provisions.
    (2) Require installations under their authority to report each 
instance of withdrawal of commercial solicitation privileges.
    (3) Submit lists of all individuals and companies who have had 
their commercial solicitation privileges withdrawn at installations 
under their authority to the PDUSD(P&R) in accordance with this part.


Sec.  50.6  Procedures.

    (a) General. (1) No person has authority to enter a DoD 
installation to transact personal commercial solicitation as a matter 
of right. Personal commercial solicitation may be permitted only if the 
following requirements are met:
    (i) The solicitor is duly licensed under applicable Federal, State, 
or municipal laws and has complied with installation regulations.
    (ii) A specific appointment has been made for each meeting with the 
individual concerned. Each meeting is conducted only in family quarters 
or in other areas designated by the installation commander.
    (iii) The solicitor agrees to provide each person solicited the 
personal commercial solicitation evaluation included in DD Form 2885 
\3\ during the initial appointment. The person being solicited is not 
required to complete the evaluation. However, completed evaluations 
should be sent by the person who was solicited to the office designated 
by the installation commander on the back of the evaluation form.
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    \3\ Copies may be obtained from https://www.dtic.mil/whs/
directives/infomgt/forms/forminfo/forminfopage2239.html.
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    (iv) The solicitor agrees to provide DoD personnel with a written 
reminder, prior to their making a financial commitment, that free legal 
advice is available from the Office of the Staff Judge Advocate.
    (2) Solicitors on overseas installations shall be required to 
observe, in addition to the above, the applicable laws of the host 
country. Upon request, the solicitor must present documentary evidence 
to the installation commander that the company they represent, and its 
agents, meet the applicable licensing requirements of the host country.
    (b) Life insurance products and securities. (1) Life insurance 
products and securities offered and sold to DoD personnel shall meet 
the prerequisites described in Sec.  50.3.
    (2) Installation commanders may permit insurers and their agents to 
solicit on DoD installations if the requirements of paragraph (a) of 
this section are met and if they are licensed under the insurance laws 
of the State

[[Page 38766]]

where the installation is located. Commanders will ensure the agent's 
license status and complaint history are checked with the appropriate 
State or Federal regulators before granting permission to solicit on 
the installation.
    (3) In addition, before approving insurance and financial product 
agents' requests for permission to solicit, commanders shall review the 
list of agents and companies currently barred, banned, or limited from 
soliciting on any or all DoD installations. This list may be viewed via 
the Personal Commercial Solicitation Report ``quick link'' at https://
www.commanderspage.com. In overseas areas, the DoD Components shall 
limit insurance solicitation to those insurers registered under the 
provisions of appendix B to this part.
    (4) The conduct of all insurance business on DoD installations 
shall be by specific appointment. When establishing the appointment, 
insurance agents shall identify themselves to the prospective purchaser 
as an agent for a specific insurer.
    (5) Installation commanders shall designate areas where interviews 
by appointment may be conducted. The opportunity to conduct scheduled 
interviews shall be extended to all solicitors on an equitable basis. 
Where space and other considerations limit the number of agents using 
the interviewing area, the installation commander may develop and 
publish local policy consistent with this concept.
    (6) Installation commanders shall make disinterested third-party 
insurance counseling available to DoD personnel desiring counseling. 
Financial counselors shall encourage DoD personnel to seek legal 
assistance or other advice from a disinterested third-party before 
entering into a contract for insurance or securities.
    (7) In addition to the solicitation prohibitions contained in 
paragraph (d) of this section, DoD Components shall prohibit the 
following:
    (i) The use of DoD personnel representing any insurer, dealing 
directly or indirectly on behalf of any insurer or any recognized 
representative of any insurer on the installation, or as an agent or in 
any official or business capacity with or without compensation.
    (ii) The use of an agent as a participant in any Military Service-
sponsored education or orientation program.
    (iii) The designation of any agent or the use by any agent of 
titles (for example, ``Battalion Insurance Counselor,'' ``Unit 
Insurance Advisor,'' ``Servicemen's Group Life Insurance Conversion 
Consultant,'') that in any manner, states, or implies any type of 
endorsement from the U.S. Government, the Armed Forces, or any State or 
Federal agency or government entity.
    (iv) The use of desk space for interviews for other than a specific 
prearranged appointment. During such appointment, the agent shall not 
be permitted to display desk signs or other materials announcing his or 
her name or company affiliation.
    (v) The use of an installation ``daily bulletin,'' marquee, 
newsletter, Web page, or other official notice to announce the presence 
of an agent and/or his or her availability.
    (c) Supervision of on-base commercial activities. (1) All pertinent 
installation regulations shall be posted in a place easily accessible 
to those conducting and receiving personal commercial solicitation on 
the installation.
    (2) The installation commander shall make available a copy of 
installation regulations to anyone conducting on-base commercial 
solicitation activities warning that failure to follow the regulations 
may result in the loss of solicitation privileges.
    (3) The installation commander, or designated representative, shall 
inquire into any alleged violations of this part or of any questionable 
solicitation practices. The DD Form 2885 is provided as a means to 
supervise solicitation activities on the installation.
    (d) Prohibited practices. The following commercial solicitation 
practices shall be prohibited on all DoD installations:
    (1) Solicitation of recruits, trainees, and transient personnel in 
a group setting or ``mass'' audience and solicitation of any DoD 
personnel in a ``captive'' audience where attendance is not voluntary.
    (2) Making appointments with or soliciting military or DoD civilian 
personnel during their normally scheduled duty hours.
    (3) Soliciting in barracks, day rooms, unit areas, transient 
personnel housing, or other areas where the installation commander has 
prohibited solicitation.
    (4) Use of official military identification cards or DoD vehicle 
decals by active duty, retired or reserve members of the Military 
Services to gain access to DoD installations for the purpose of 
soliciting. When entering the installation for the purpose of 
solicitation, solicitors with military identification cards and/or DoD 
vehicle decals must present documentation issued by the installation 
authorizing solicitation.
    (5) Procuring, attempting to procure, supplying, or attempting to 
supply non-public listings of DoD personnel for purposes of commercial 
solicitation, except for releases made in accordance with DoD Directive 
5400.7.\4\
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    \4\ See footnote 1 to Sec.  50.3.
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    (6) Offering unfair, improper, or deceptive inducements to purchase 
or trade.
    (7) Using promotional incentives to facilitate transactions or to 
eliminate competition.
    (8) Using manipulative, deceptive, or fraudulent devices, schemes, 
or artifices, including misleading advertising and sales literature. 
All financial products, which contain insurance features, must clearly 
explain the insurance features of those products.
    (9) Using oral or written representations to suggest or give the 
appearance that the Department of Defense sponsors or endorses any 
particular company, its agents, or the goods, services, and commodities 
it sells.
    (10) DoD personnel making personal commercial solicitations or 
sales to DoD personnel who are junior in rank or grade, or to the 
family members of such personnel, except as authorized in Section 2-205 
and 5-409 of the Joint Ethics Regulation, DoD 5500.7-R.\5\
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    \5\ See footnote 1 to Sec.  50.3.
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    (11) Entering into any unauthorized or restricted area.
    (12) Using any portion of installation facilities, including 
quarters, as a showroom or store for the sale of goods or services, 
except as specifically authorized by DoD Directive 1330.17 \6\ and DoD 
Instructions 1015.10, 1000.15 \7\ and 1330.21.\8\ This does not apply 
to normal home enterprises that comply with applicable State and local 
laws and installation rules.
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    \6\ See footnote 1 to Sec.  50.3.
    \7\ See footnote 1 to Sec.  50.3.
    \8\ See footnote 1 to Sec.  50.3.
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    (13) Soliciting door to door or without an appointment.
    (14) Unauthorized advertising of addresses or telephone numbers 
used in personal commercial solicitation activities conducted on the 
installation, or the use of official positions, titles, or organization 
names, for the purpose of personal commercial solicitation, except as 
authorized in DoD 5500.7-R. Military grade and Military Service as part 
of an individual's name (e.g., Captain Smith, U.S. Marine Corps) may be 
used in the same manner as conventional titles, such as ``Mr.'', 
``Mrs.'', or ``Honorable''.
    (15) Contacting DoD personnel by calling a government telephone, 
faxing to a government fax machine, or by sending e-mail to a 
government computer, unless a pre-existing relationship (i.e., the DoD 
member is a

[[Page 38767]]

current client or requested to be contacted) exists between the parties 
and the DoD member has not asked for contact to be terminated.
    (e) Denial, suspension, and withdrawal of installation solicitation 
privileges. (1) The installation commander shall deny, suspend, or 
withdraw permission for a company and its agents to conduct commercial 
activities on the base if such action is in the best interests of the 
command. The grounds for taking these actions may include, but are not 
limited to, the following:
    (i) Failure to meet the licensing and other regulatory requirements 
prescribed in this part or violations of the State law where the 
installation is located. Commanders will request that appropriate state 
officials determine whether a company or agent violated State law.
    (ii) Commission of any of the practices prohibited in paragraphs 
(b)(6) and (d) of this section.
    (iii) Substantiated complaints and/or adverse reports regarding the 
quality of goods, services, and/or commodities, and the manner in which 
they are offered for sale.
    (iv) Knowing and willful violations of Public Law 90-321.
    (v) Personal misconduct by a company's agent or representative 
while on the installation.
    (vi) The possession of, and any attempt to obtain supplies of 
direct deposit forms, or any other form or device used by Military 
Departments to direct a Service member's pay to a third party, or 
possession or use of facsimiles thereof. This includes using or 
assisting in using a Service member's ``MyPay'' account or other 
similar Internet medium for the purpose of establishing a direct 
deposit for the purchase of insurance or other investment product.
    (vii) Failure to incorporate and abide by the Standards of Fairness 
policies contained in DoD Instruction 1344.9.\9\
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    \9\ See footnote 1 to Sec.  50.3.
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    (2) The installation commander may determine that circumstances 
dictate the immediate suspension of solicitation privileges while an 
investigation is conducted. Upon suspending solicitation privileges, 
the commander shall promptly inform the agent and the company the agent 
represents, in writing.
    (3) In suspending or withdrawing solicitation privileges, the 
installation commander shall determine whether to limit such action to 
the agent alone or extend it to the company the agent represents. This 
decision shall be based on the circumstances of the particular case, 
including, but not limited to, the nature of the violations, frequency 
of violations, the extent to which other agents of the company have 
engaged in such practices and any other matters tending to show the 
culpability of an individual and the company.
    (4) If the investigation determines an agent or company does not 
possess a valid license or the agent, company, or product has failed to 
meet other State or Federal regulatory requirements, the installation 
commander shall immediately notify the appropriate regulatory 
authorities.
    (5) In a withdrawal action, the commander shall allow the 
individual or company an opportunity to show cause as to why the action 
should not be taken. To ``show cause'' means an opportunity must be 
given for the aggrieved party to present facts on an informal basis for 
the consideration of the installation commander or the commander's 
designee. The installation commander shall make a final decision 
regarding withdrawal based upon the entire record in each case. 
Installation commanders shall report concerns or complaints involving 
the quality or suitability of financial products or concerns or 
complaints involving marketing methods used to sell these products to 
the appropriate State and Federal regulatory authorities. Also, 
installation commanders shall report any suspension or withdrawal of 
insurance or securities products solicitation privileges to the 
appropriate State or Federal regulatory authorities.
    (6) The installation commander shall inform the Military Department 
concerned of any denial, suspension, withdrawal, or reinstatement of an 
agent or company's solicitation privileges and the Military Department 
shall inform the Office of the PDUSD(P&R), which will maintain a list 
of insurance and financial product companies and agents currently 
barred, banned, or otherwise limited from soliciting on any or all DoD 
installations. This list may be viewed at https://
www.commanderspage.com. If warranted, the installation commander may 
recommend to the Military Department concerned that the action taken be 
extended to other DoD installations. The Military Department may extend 
the action to other military installations in the Military Department. 
The PDUSD(P&R), following consultation with the Military Department 
concerned, may order the action extended to other Military Departments.
    (7) All suspensions or withdrawals of privileges may be permanent 
or for a set period of time. If for a set period, when that period 
expires, the individual or company may reapply for permission to 
solicit through the installation commander or Military Department 
originally imposing the restriction. The installation commander or 
Military Department reinstating permission to solicit shall notify the 
Office of the PDUSD(P&R) and appropriate State and Federal regulatory 
agencies when such suspensions or withdrawals are lifted.
    (8) The Secretaries of the Military Departments may direct the 
Armed Forces Disciplinary Control Boards in all geographical areas in 
which the grounds for withdrawal action have occurred to consider all 
applicable information and take action that the Boards deem 
appropriate.
    (9) Nothing in this part limits the authority of the installation 
commander or other appropriate authority from requesting or instituting 
other administrative and/or criminal action against any person, 
including those who violate the conditions and restrictions upon which 
installation entry is authorized.
    (f) Advertising and commercial sponsorship. (1) The Department of 
Defense expects voluntary observance of the highest business ethics by 
commercial enterprises soliciting DoD personnel through advertisements 
in unofficial military publications when describing goods, services, 
commodities, and the terms of the sale (including guarantees, 
warranties, and the like).
    (2) The advertising of credit terms shall conform to the provisions 
of 15 U.S.C. 1601 as implemented by Federal Reserve Board Regulation Z 
according to 12 CFR part 226.
    (3) Solicitors may provide commercial sponsorship to DoD Morale, 
Welfare and Recreation programs or events according to DoD Instruction 
1015.10. However, sponsorship may not be used as a means to obtain 
personal contact information for any participant at these events 
without written permission from the individual participant. In 
addition, commercial sponsors may not use sponsorship to advertise 
products and/or services not specifically agreed to in the sponsorship 
agreement.
    (4) The installation commander may permit organizations to display 
sales literature in designated locations subject to command policies. 
In accordance with DoD 7000.14-R,\10\ Volume 7(a), distribution of 
competitive literature or forms by off-base banks and/or credit unions 
is prohibited on installations where an authorized on-base bank and/or 
credit union exists.
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    \10\ See footnote 1 to Sec.  50.3.

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[[Page 38768]]

    (g) Educational programs. (1) The Military Departments shall 
develop and disseminate information and provide educational programs 
for members of the Military Services on their personal financial 
affairs, including such subjects as insurance, Government benefits, 
savings, budgeting, and other financial education and assistance 
requirements outlined in DoD Instruction 1342.27.\11\ The Military 
Departments shall ensure that all instructors are qualified as 
appropriate for the subject matter presented. The services of 
representatives of authorized on-base banks and credit unions may be 
used for this purpose. Under no circumstances shall commercial agents, 
including representatives of loan, finance, insurance, or investment 
companies, be used for this purpose. Presentations shall only be 
conducted at the express request of the installation commander.
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    \11\ See footnote 1 to Sec.  50.3.
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    (2) The Military Departments shall also make qualified personnel 
and facilities available for individual counseling on loans and 
consumer credit transactions in order to encourage thrift and financial 
responsibility and promote a better understanding of the wise use of 
credit, as prescribed in DoD 7000.14-R.
    (3) The Military Departments shall encourage military members to 
seek advice from a legal assistance officer, the installation financial 
counselor, their own lawyer, or a financial counselor, before making a 
substantial loan or credit commitment.
    (4) Each Military Department shall provide advice and guidance to 
DoD personnel who have a complaint under DoD 1344.9 or who allege a 
criminal violation of its provisions, including referral to the 
appropriate regulatory agency for processing of the complaint.
    (5) Banks and credit unions operating on DoD installations are 
required to provide financial counseling services as an integral part 
of their financial services offerings. Representatives of and materials 
provided by authorized banks and/or credit unions located on military 
installations may be used to provide the educational programs and 
information required by this part subject to the following conditions:
    (i) If the bank or credit union operating on a DoD installation 
sells insurance or securities or has any affiliation with a company 
that sells or markets insurance or other financial products, the 
installation commander shall consider that company's history of 
complying with this part before authorizing the on-base financial 
institution to provide financial education.
    (ii) All prospective educators must agree to use appropriate 
disclaimers in their presentations and on their other educational 
materials. The disclaimers must clearly indicate that they do not 
endorse or favor any commercial supplier, product, or service, or 
promote the services of a specific financial institution.
    (6) Use of other non-government organizations to provide financial 
education programs is limited as follows:
    (i) Under no circumstances shall commercial agents, including 
employees or representatives of commercial loan, finance, insurance, or 
investment companies, be used.
    (ii) The limitation in paragraph (g)(6)(i) of this section does not 
apply to educational programs and information regarding the Survivor 
Benefits Program and other government benefits provided by tax-exempt 
organizations under section (c)(23) of 26 U.S.C. 501 or by any 
organization providing such a benefit under a contract with the 
Government.
    (iii) Educators from non-government, non-commercial organizations 
expert in personal financial affairs and their materials may, with 
appropriate disclaimers, provide the educational programs and 
information required by this part if approved by a Presidentially-
appointed, Senate-confirmed civilian official of the Military 
Department concerned. Presentations by approved organizations shall be 
conducted only at the express request of the installation commander. 
The following criteria shall be used when considering whether to permit 
a non-government, non-commercial organization to present an educational 
program or provide materials on personal financial affairs:
    (A) The organization must qualify as a tax-exempt organization 
under 5 U.S.C. 501(c)(3) or 5 U.S.C. 501(c)(23).
    (B) If the organization has any affiliation with a company that 
sells or markets insurance or other financial products, the approval 
authority shall consider that company's history of complying with this 
part.
    (C) All prospective educators must use appropriate disclaimers, in 
their presentations and on their other educational materials, which 
clearly indicate that they and the Department of Defense do not endorse 
or favor any commercial supplier, product, or service or promote the 
services of a specific financial institution.


Sec.  50.7  Information requirements.

    The reporting requirements concerning the suspension or withdrawal 
of solicitation privileges have been assigned Report Control Symbol 
(RCS) DD-P&R(Q)2182 in accordance with DoD 8910.1-M.\12\
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    \12\ See footnote 1 to Sec.  50.3.
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Appendix A to Part 50--Life Insurance Products and Securities

A. Life Insurance Product Content Prerequisites

    Companies must provide DoD personnel a written description for 
each product or service they intend to market to DoD personnel on 
DoD installations. These descriptions must be written in a manner 
that DoD personnel can easily understand, and fully disclose the 
fundamental nature of the policy. Companies must be able to 
demonstrate that each form to be used has been filed with and 
approved, where applicable, by the insurance department of the State 
where the installation is located. Insurance products marketed to 
DoD personnel on overseas installations must conform to the 
standards prescribed by the laws of the State where the company is 
incorporated.
    1. Insurance products, other than certificates or other evidence 
of insurance issued by a self-insured association, offered and sold 
worldwide to personnel on DoD installations, must:
    a. Comply with the insurance laws of the State or country in 
which the installation is located and the requirements of this part.
    b. Contain no restrictions by reason of Military Service or 
military occupational specialty of the insured, unless such 
restrictions are clearly indicated on the face of the contract.
    c. Plainly indicate any extra premium charges imposed by reason 
of Military Service or military occupational specialty.
    d. Contain no variation in the amount of death benefit or 
premium based upon the length of time the contract has been in 
force, unless all such variations are clearly described in the 
contract.
    e. In plain and readily understandable language, and in type 
font at least as large as the font used for the majority of the 
policy, inform Service members of:
    1. The availability and cost of government subsidized 
Servicemen's Group Life Insurance.
    2. The address and phone number where consumer complaints are 
received by the State insurance commissioner for the State in which 
the insurance product is being sold.
    3. That the U.S. Government has in no way sanctioned, 
recommended, or encouraged the sale of the product being offered. 
With respect to the sale or solicitation of insurance on Federal 
land or facilitates located outside the United States, insurance 
products must contain the address and phone number where consumer 
complaints are received by the State insurance commissioner for the 
State which has issued the agent a resident license or the company 
is domiciled, as applicable.

[[Page 38769]]

    2. To comply with paragraphs A.1.b., A.1.c. and A.1.d., an 
appropriate reference stamped on the first page of the contract 
shall draw the attention of the policyholder to any restrictions by 
reason of Military Service or military occupational specialty. The 
reference shall describe any extra premium charges and any 
variations in the amount of death benefit or premium based upon the 
length of time the contract has been in force.
    3. Variable life insurance products may be offered provided they 
meet the criteria of the appropriate insurance regulatory agency and 
the Securities and Exchange Commission.
    4. Insurance products shall not be marketed or sold disguised as 
investments. If there is a savings component to an insurance 
product, the agent shall provide the customer written documentation, 
which clearly explains how much of the premium goes to the savings 
component per year broken down over the life of the policy. This 
document must also show the total amount per year allocated to 
insurance premiums. The customer must be provided a copy of this 
document that is signed by the insurance agent.

B. Sale of Securities

    1. All securities must be registered with the Securities and 
Exchange Commission.
    2. All sales of securities must comply with the appropriate 
Securities and Exchange Commission regulations.
    3. All securities representatives must apply to the commander of 
the installation on which they desire to solicit the sale of 
securities for permission to solicit.
    4. Where the accredited insurer's policy permits, an overseas 
accredited life insurance agent--if duly qualified to engage in 
security activities either as a registered representative of the 
National Association of Securities Dealers or as an associate of a 
broker or dealer registered with the Securities and Exchange 
Commission--may offer life insurance and securities for sale 
simultaneously. In cases of commingled sales, the allotment of pay 
for the purchase of securities cannot be made to the insurer.

C. Use of the Allotment of Pay System

    1. Allotments of military pay for life insurance products shall 
be made in accordance with DoD 7000.14-R.
    2. For personnel in pay grades E-4 and below, in order to obtain 
financial counseling, at least seven calendar days shall elapse 
between the signing of a life insurance application and the 
certification of a military pay allotment for any supplemental 
commercial life insurance. Installation Finance Officers are 
responsible for ensuring this seven-day cooling-off period is 
monitored and enforced. The purchaser's commanding officer may grant 
a waiver of the seven-day cooling-off period requirement for good 
cause, such as the purchaser's imminent deployment or permanent 
change of station.

D. Associations--General

    The recent growth and general acceptability of quasi-military 
associations offering various insurance plans to military personnel 
are acknowledged. Some associations are not organized within the 
supervision of insurance laws of either a State or the Federal 
Governmen