Current through Register Vol. 48, No. 12, March 22, 2024
a) The
information required to be disclosed by this Part shall not be minimized,
rendered obscure or presented in an ambiguous fashion or intermingled with the
text of the advertisement so as to be confusing or misleading.
b) No advertisement shall omit material
information or use words, phrases, statements, references or illustrations if
such omission or such use has the capacity, tendency or effect of misleading or
deceiving purchasers or prospective purchasers as to the nature or extent of
the insurance, any policy benefit payable, loss covered, premium payable or
state or federal tax consequences. The fact that the policy offered is made
available to a prospective insured for inspection prior to consummation of the
sale, or an offer is made to refund the premium if the purchaser is not
satisfied, does not remedy misleading statements.
c) In the event an advertisement used
"Non-Medical," "No Medical Examination Required" or similar terms where issue
is not guaranteed, such terms shall be accompanied by a further disclosure of
equal prominence and in juxtaposition thereto to the effect that issuance of
the policy may depend upon the answers to the health questions.
d) An advertisement shall not use as the name
or title of a life insurance policy or an annuity, any phrase which does not
include the words "life insurance" or "annuity" unless accompanied by other
language clearly indicating it is life insurance.
e) An advertisement shall prominently include
the specific title of the type of the policy being marketed and such title
shall not be misleading as to the policy benefits.
f) An advertisement of an insurance policy
marketed by the direct response techniques shall not state or imply that
because there is no agent or commission included, there will be a cost savings
to prospective purchasers unless such is the fact. No such cost savings may be
stated or implied without justification satisfactory to the Insurance Director
prior to use.
g) An advertisement
for a policy containing graded or modified benefits shall prominently display
any limitation of benefits. If the premium is level and coverage decreases or
increases with age or duration, such fact shall be prominently
disclosed.
h) An advertisement for
a policy with non-level premiums shall prominently describe the premium
changes.
i) Dividends and Other
Non-Guaranteed Elements
1) An advertisement
shall not utilize or describe dividends or other non-guaranteed elements in a
manner which is misleading or has the capacity or tendency to
mislead.
2) An advertisement shall
not state or imply that the payment or amount of dividends is guaranteed. If
dividends or other non-guaranteed elements are illustrated they must be based
on the insurer's illustrated scale and the illustration must contain a
statement to the effect that they are not to be construed as guarantees or
estimates of dividends to be paid in the future.
3) An advertisement shall not state or imply
that illustrated dividends under a participating policy and/or pure endowments
will be or can be sufficient at any future time to assure, without the further
payment of premiums, the receipt of benefits, such as a paid-up policy, unless
the advertisement clearly and precisely explains:
A) what benefits or coverage would be
provided at such time, and
B) under
what conditions this would occur.
j) An advertisement shall not state that a
purchaser of a policy will share in or receive a stated percentage or portion
of the earnings on the general account assets of the company.
k) Testimonials or Endorsements by Third
Parties
1) Testimonials used in
advertisements must be genuine; represent the current opinion of the author; be
applicable to the policy advertised, if any; and be accurately reproduced. In
using a testimonial the insurer acknowledges as its own all of the statements
contained therein, and such statements are subject to all the provisions of
this Part.
2) If the individual
making a testimonial or an endorsement has a financial interest in the insurer
or a related entity as a stockholder, director, officer, employee or otherwise,
or receives any benefit directly or indirectly other than required union scale
wages, such fact shall be disclosed in the advertisement.
3) An advertisement shall not state or imply
that an insurer or policy has been approved or endorsed by a group of
individuals, society, association or other organization unless such is the fact
and unless any proprietary relationship between an organization and the insurer
is disclosed. If the entity making the endorsement or testimonial is owned,
controlled or managed by the insurer, or receives any payment or other
consideration from the insurer for making such endorsement or testimonial, such
fact shall be disclosed in the advertisement.
l) An advertisement shall not contain
statistical information relating to any insurer or policy unless it accurately
reflects recent and relevant facts. The source of any such statistics used in
an advertisement shall be identified therein.
m) Introductory, Initial or Special Offers
and Enrollment Periods
1) An advertisement of
an individual policy or combination of such policies shall not state or imply
that such policy or combination of such policies is an introductory, initial or
special offer or that applicants will receive substantial advantages not
available at a later date, or that the offer is available only to a specified
group of individuals, unless such is the fact. An advertisement shall not
describe an enrollment period as "special" or "limited" or use similar words or
phrases in describing it when the insurer uses successive enrollment periods as
its usual method of marketing its policies.
2) An advertisement shall not state or imply
that only a specific number of policies will be sold, or that a time is fixed
for the discontinuance of the sale of the particular policy advertised because
of special advantages available in the policy.
3) An advertisement shall not offer a policy
which utilizes a reduced initial rate in a manner which over emphasizes the
availability and the amount of the initial premium. When an insurer charges an
initial premium that differs in amount from the amount of the renewal premium
payable on the same mode, all references to the reduced initial premium shall
be followed by an asterisk or other appropriate symbol which refers the reader
to that specific portion of the advertisement that contains a full rate
schedule for the policy being advertised.
4) An enrollment period during which a
particular insurance policy may be purchased on an individual basis shall not
be offered within this State unless there has been a lapse of not less than six
months between the close of the immediately preceding enrollment period for the
same policy and the opening of the new enrollment period. The advertisement
shall specify the date by which the applicant must mail the application, which
shall be not less than ten days and not more than forty days following the date
on which such enrollment period is advertised for the first time. This Part
applies to all advertising media: i.e., mail, newspapers, radio, television,
magazines and periodicals, by any one insurer. The phrase "any one insurer"
includes all the affiliated companies of a group of insurance companies under
common management or control. This Part does not apply to the use of a
termination or cut-off date beyond which an individual application for a
guaranteed issue policy will not be accepted by an insurer in those instances
where the application has been sent to the applicant in response to his
request. It is also inapplicable to solicitations to employees or members of a
particular group or association which otherwise would be eligible under
specific provisions of the Insurance Code for group or blanket insurance. In
cases where an insurance product is marketed on a direct mail basis to
prospective insureds by reason of some common relationship with a sponsoring
organization, this Part shall be applied separately to such sponsoring
organization.
n) An
advertisement of a particular policy shall not state or imply that prospective
insureds shall be or become members of a special class, group, or quasi-group
and as such enjoy special rates, dividends or underwriting privileges, unless
such is the fact.
o) An
advertisement shall not make unfair or incomplete comparisons of policies,
benefits, dividends or rates of other insurers. An advertisement shall not
falsely or unfairly describe other insurers, their policies, services or
methods of marketing.
p) An
advertisement for the solicitation or sale of a preneed funeral contract or
prearrangement as defined in Section
909.20 of this Part,
which is funded or to be funded by a life insurance policy or annuity contract,
shall disclose the following:
1) the fact
that a life insurance policy or annuity contract is involved or being used to
fund a prearrangement as defined in Section
909.20 of this
Part,
2) the nature of the
relationship among the soliciting producer or producers, the provider of the
funeral merchandise or services, the administrator and any other
persons,
3) the fact that the
family or representative of the deceased has the right to change the choice of
the prearranged provider of funeral/cemetery merchandise and services upon the
demise of the insured,
4) the fact
that in the event the policy proceeds exceed the prearranged cost for
funeral/cemetery merchandise and services, the excess proceeds will be payable
to a secondary beneficiary.