Current through September 24, 2024
(1) The information
required to be disclosed by these rules 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.
(2) 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
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.
(3)
In the event an advertisement uses "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.
(4) 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 or an annuity.
(5) An
advertisement shall prominently describe the type of policy
advertised.
(6) An advertisement of
an insurance policy marketed by direct response techniques shall not state or
imply that because there is no agent or commission there will be a cost saving
to prospective purchasers unless such is the fact. No such cost savings may be
stated or implied without justification satisfactory to the Commissioner prior
to use.
(7) 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.
(8) An advertisement for
a policy with non-level premiums shall prominently describe the premium
changes.
(9) Dividends
(a) An advertisement shall not utilize or
describe dividends in a manner which is misleading or has the capacity or a
tendency to mislead.
(b) An
advertisement shall not state or imply that the payment or amount of dividends
is guaranteed. If dividends are illustrated, they must be based on the
insurer's current dividend 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.
(c) 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 (1) what benefits or coverage
would be provided at such time and (2) under what conditions this would
occur.
(10) 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.
(11)
Testimonials or Endorsements by Third Parties.
(a) 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 makes as its own all of the statements contained
therein, and such statements are subject to all the provisions of these
rules.
(b) 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.
(c) An advertisement shall not state or imply
that an insurer or a 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.
(12) 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.
(13) Introductory, Initial or Special Offers
and Enrollment Periods.
(a) 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.
(b) 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.
(c) An advertisement shall not offer a policy
which utilizes a reduced initial premium rate in a manner which overemphasizes
the availability and the amount of the reduced 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 which contains
the full rate schedule for the policy being advertised.
(d) 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
three 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 indicate the date by which the applicant must mail the
application, which shall be not less than ten days and not more than forty days
from the date that such enrollment period is advertised for the first time.
This rule 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 rule does not apply to the
use of termination or cutoff 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 of employees or members of a
particular group or association which otherwise would be eligible underspecific
provisions of the Insurance Code for group, blanket, or franchise insurance. In
cases where an insurance product is marketed on a direct mail basis to
prospective insured by reason of some common relationship with a sponsoring
organization, this rule shall be applied separately to each such sponsoring
organization.
(14) An
advertisement of a particular policy shall not state or imply that prospective
insurers 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.
(15) 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.
Authority: T.C.A.
§§.56-2-301.
