Life Insurance Advertisements and Solicitation

Enforcement Procedures

Each insurer is required to maintain a compete file of all printed, published, or prepared advertisements of the insurer's policies. These files are subject to inspection by the Insurance Department and must be kept either for 4 years or until the next regular examination by the Department, whichever is longer.

Disclosure Requirements

Information that is required to be disclosed cannot be minimized, obscured, or presented in an ambiguous way; Omissions of material information is not allowed; Advertisements that do not guarantee policy issue but use the terms nonmedical, no medical examination required, or similar terms must also clearly and prominently state that the policy issuance may depend on answers to health questions; Advertisement may not use as the name or title of a policy 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; Prominently describe the specific type of policy being advertised; For policies marketed by direct response: not imply that there will be a cost savings to purchasers because there is no agent or commission involved, unless that is true; For graded or modified policies must prominently display any limitations of benefits; Any comparisons between participating and nonparticipating policies must be accurate; Advertisements for policies with non-level premiums must prominently display premiums changes; Not make unfair or incomplete comparisons with another insurer's policies, benefits, dividends or rates, or unfairly describe the other insurer's services or marketing methods; Not state or imply that prospective insured must be or become members of a special class or group to take advantage of special rates, dividends, or underwriting privileges (unless that is true); Advertisements that use testimonials must ensure that the testimonials are genuine, accurately reproduced and represent the author's current opinion. If the person is compensated, the testimonial must clearly state that it's a paid endorsement; and If targeting students, disclose that the correspondence is not coming from the school, and that the i

General Rules and Disclosures

Prior to beginning a life insurance sales presentation, insurance agents must inform a prospective applicant that they are acting as a life insurance agent and provide the prospect the full name of the insurance company the agent is representing. In addition, the following solicitation requirements apply: A reference to policy dividends must include a statement that dividends are not guaranteed. A presentation of benefits cannot display guaranteed and nonguaranteed benefits as a single sum, unless they also are shown separately nearby. A statement regarding the use of the Life Insurance Cost Indexes must include a prominent explanation to the effect than the indexes are useful only for the comparison of the relative costs of two or more similar policies.

Life Insurance Solicitation Regulation

The purpose of the Life Insurance Solicitation Regulation is to provide buyers with information which will improve their ability to select the most appropriate life insurance products to serve their needs, improve their understanding of the basic features of the policy, and improve their ability to evaluate the relative costs of similar plans of life insurance.

In addition,

advertisements for life insurance policies and annuities must not use as the name or title of a policy or contract any phrase that does not include the words life insurance or annuity unless accompanied by other clear language indicating that it is that type of contract.

Advertisement

cannot use any of the terms that may lead the consumer to believe that he or she will receive any benefit not available to other persons of the same class and equal life expectancy. The following terms are considered misleading: investment, investment plan, founder's plan, charter plan, deposit, expansion plan, profits, profit sharing, interest plan, savings plan, private pension plan, retirement plan, risk-free, and similar.

Advertisements must

clearly identify and prominently display the name of the insurer. If a policy sale is through an agent, the advertisement must clearly disclose the full names of all insurers that the agent is authorized to represent. Advertisements may not use words, symbols, or any combination of words or symbols similar to those of state or federal government agencies if they could mislead or deceive as to the true identity of the insurer, or imply that the solicitation is connected with a government agency.

Note that

communications within the insurer's own organization or any communication with the policyholders not intended for a sale or modification of a policy is not considered advertisement.

Georgia

has established minimum standards and guidelines for life insurance advertising to ensure truthful disclosure of information, and help consumers make insurance purchasing decisions in their best interest. Advertisement regulation applies to all life insurance policies or annuities. Insurers are required to establish and maintain a system of control over the content of all advertisement. Advertisements are always the responsibility of the insurer, regardless of who wrote, created, designed, or presented them.

If advertisements are used beyond the limits of the jurisdiction

in which the insurer is licensed, they may not imply insurer licensing outside of that jurisdiction. Although advertisements may state that an insurer is licensed within a state, they may not imply that competing insurers may not be so licensed.

Advertisements

may use a government entity endorsement only if the entity has endorsed a policy and authorized the insurer to use that endorsement in its advertisement.

Advertisement

means any material designed to persuade the public to purchase life insurance, including the following: Printed and published material, audiovisual material and descriptive literature used in mail, newspapers, magazines, radio and television, billboards and others; Descriptive literature and sales aids of all kinds used by an insurer, agent, or broker for presentation to member s of the public including leaflets, booklets, and form letters; and Prepared sales talks, presentation and material for use by insurance agents.

Advertisements

must be clearly written, truthful, and not misleading in fact or by implication. The form and content of any advertisement for an annuity contract must be sufficiently complete and clear so as to avoid deception. The Commissioner of Insurance will have the power to determine whether advertisements are clearly written and can be understood by a person of average education or intelligence for the market segment to which the advertisement is being directed.

Each insurer

must maintain at its home office or principal office, a complete file containing one copy of each document authorized by the insurer for use in sales presentations. The file must contain one copy of each authorized form for a period of 3 years following the date of its last authorized use.

Prior to soliciting or receiving an application,

the insurer must provide, to all prospective purchasers, a Buyer's Guide. The insurer must also provide to all prospective purchasers a Policy Summary prior to accepting the applicant's initial premium unless the policy for which application is made contains an unconditional refund provision of at least 10 days. The insurer must also provide a Buyer's Guide and a Policy Summary to any prospective purchaser or present policyholder upon request.

This regulation applies to any issuer of life insurance contracts. This regulation does not apply to the sale of the following:

Annuities; Credit life insurance; Group life insurance; Variable life insurance policies in which the death benefits and cash values vary according to the investments in a separate account; and Life insurance policies issued in connection with pension and welfare plans that are subject to ERISA.