Current through Register Vol. 48, No. 18, September 15,
2023
PURPOSE: This rule describes those statements which
will be considered to be deceptive practices or misrepresentations in the
solicitation of life insurance. This rule was adopted pursuant to the
provisions of section
374.045,
RSMo and implements and defines sections 375.930-375.948,
376.500,
376.590
and 376.673, RSMo.
(1) No
insurance company shall deliver or issue in this state or permit its insurance
producers or officers to deliver or promise to issue or deliver in this state
its own stock or other stock or securities as an inducement to the purchase of
insurance. No corporation or any of its insurance producers, officers or
employees shall agree to sell, offer to sell, or give or offer, directly or
indirectly, in any manner whatsoever any share of stock, securities or bonds as
an inducement to the purchase of insurance.
(2) The practices and representations
enumerated and listed in this rule are deemed to violate those sections of the
Missouri Insurance Code set out in this rule and violations of same by
companies or their insurance producers shall subject the violators to the
penalties now contained in section
375.930,
RSMo. Violations of same will consist of any of the following statements:
(A) Statements of policy titles indicating or
implying that the policyholder will participate in the distribution of earnings
or surplus other than earnings or surplus attributable, by reasonable and
nondiscriminatory standards, to the participating policies of the company and
allocated to the policyholder on reasonable and nondiscriminatory
standards;
(B) Statements or
illustrations implying that a proposed policyholder will be entitled to share
in any part of surplus earnings attributable to nonparticipating business or to
other classes of participating business;
(C) Statements or illustrations setting forth
the dividend scale of other companies (or a dividend scale of the company for a
plan of insurance no longer being offered or for a plan of insurance other than
the plan being offered to the proposed policyholder) with the implication that
these statements or illustrations serve as some sort of a guideline as to what
the proposed policyholder might expect to receive under the proposed
policy;
(D) Statements or
representations or the use of any documents (either in the form of a copy of a
board resolution, certificate of participation or in any other manner
whatsoever) in conjunction with the solicitation or issuance of a life
insurance policy which purport that the policyholder will or might reasonably
expect to receive any valuable consideration or inducement whatever, not
specified in the policy contract of insurance;
(E) Statements which do not clearly inform
one that dividends are not, and cannot be, guaranteed;
(F) Statements which purport or imply that
accumulated dividends will be sufficient, after an unreasonably short period of
time, to require no further cash outlay for the payment of premiums;
(G) Statements which purport or imply that
the anticipated annual dividend will equal or exceed the annual premium due
under the policy, except in those cases where the company's current rate manual
so reflects;
(H) Statements
indicating or implying that the policyholder will receive some preferential or
discriminatory advantage or benefit not available to persons who purchase
insurance from the company at future dates or under other
circumstances;
(I) Statements or
representations purporting that only a limited number of policies will be
issued on a particular form (however true the statements might be) since those
statements imply preferential treatment;
(J) References to the investment nature of a
policy which state or imply that a life insurance policy possesses investment
features other than those arising from the cash, loan or maturity value or the
settlement options available thereunder;
(K) Statements which tend to lead the
prospect to believe that the insurance producer is dealing in other than a life
insurance contract or that life insurance is incidental to the purchase of the
contract;
(L) Statements which tend
to lead the prospect to believe that s/he is purchasing stock of the insurance
company or that s/he is acquiring any right or benefit which corresponds to a
right or benefit enjoyed by a stockholder of the company;
(M) References to premiums as deposits in a
manner as to lead the proposed policyholder to believe that they create a fund
which is withdrawable without reference to the cash surrender or loan
provisions of the policy or the use of any passbook savings record or any other
device which leads or would tend to lead the policyholder to believe or gain
the impression that the contract represents a savings plan;
(N) Statements or representations that any
part of premium payment, advance premium payment or of dividends will be placed
in a segregated fund for the benefit of the insureds (except for those variable
contracts which might be issued pursuant to section
376.309,
RSMo);
(O) Statements which tend to
lead a prospect to believe or infer that each policy-holder is given the right
to purchase or allocate a specific number of policies;
(P) The use of comparative selling in a
manner which might lead a prospect to believe that the company's experience
under a particular plan will be as successful as the experience achieved under
a similar plan by reference to a particular company; and
(Q) Any comparison of the policies or
contracts of any such insurer(s), shall be deemed to be an incomplete
comparison, if it does not compare in detail the gross premiums and gross
premiums less any dividend or other reduction allowed by the insurer(s), at the
date of the comparison and the increase in any cash values and all the benefits
provided by each of those policies or contracts for a period of twenty (20)
years. The omission from any comparison of any benefit or value provided in any
such policies or contracts or of any differences as to amount or period of
payment of premiums shall constitute the comparison an incomplete
comparison.
(3) With
respect to life insurance policies providing for the payment of a series of
pure endowments maturing periodically during the premium paying period of the
policy companies are prohibited from-
(A)
Using any detachable coupons, certificates or passbooks or any other device
which tends to emphasize the periodic pure endowment benefits or which tend to
create the impression that the pure endowments represent interest earnings or
anything other than benefits which have been purchased by part of the
policyholder's premium payments;
(B) Offering pure endowment benefits which do
not have fixed maturity dates or the payment of which is made contingent upon
the payment of any premium becoming due on or after their maturity dates;
or
(C) Expressing pure endowment
benefits in any manner other than in dollar amounts such as by expressing them
as percentages of other quantities or in other ways.
(4) Each insurer shall notify each of its
insurance producers of the contents of this rule.
AUTHORITY: sections
374.045,
375.930,
375.948,
376.500, 376.590 and 376.673, RSMo 2000.* This rule was previously filed as 4
CSR 190-13.030. This version of rule filed Dec. 5, 1969, effective Dec. 15,
1969. Amended: Filed Aug. 5, 1974, effective Aug. 15, 1974. Amended: Filed July
12, 2002, effective Jan. 30, 2003.
*Original authority: 374.045, RSMo 1967, amended 1993,
1995; 375.930, RSMo 1959, amended 1978, 1991; 375.948, RSMo 1959, amended 1978,
1991; 376.500, RSMo 1939, amended 1965; 376.590, RSMo 1939; and 376.673, RSMo
1967.
