Code of Massachusetts Regulations › 211 CMR - DIVISION OF INSURANCE › Title 211 CMR 40.00 - Marketing of insured health plans › Section 40.07 - Benefits Payable, Losses Covered or Premiums Payable

Current through Register 1525, July 5, 2024
(1)
Deceptive Words, Phrases or
			 Illustrations Prohibited.
(a) It
			 shall be considered misleading, and therefore prohibited to omit information or
			 use words, phrases, statements, references or illustrations if such omission
			 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 or premium payable. 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.
(b) It shall be considered misleading, and
			 therefore prohibited, to solicit an offer to contract for a health insurance
			 policy without a clear and conspicuous disclosure of the premium rate for such
			 policy.
(c) It shall be considered
			 misleading, and therefore prohibited, for a marketing method of a policy whose
			 benefits are conditional upon confinement in a hospital or similar facility, to
			 refer to the benefits or costs of the policy, or the risks against which the
			 policy is intended to provide protection unless it shall also disclose both
			 clearly and conspicuously in accordance with
			 211 CMR
			 40.05 as well as on the application for such
			 policy whether benefits are based on actual costs incurred and/or the length of
			 confinement.
(d) It shall be
			 considered misleading, and therefore prohibited, for a marketing method to
			 contain or use words or phrases such as "all"; "full"; "complete";
			 "comprehensive"; "unlimited"; "up to," "as high as"; "this policy will help pay
			 your hospital and surgical bills"; "this policy will help fill some of the gaps
			 that Medicare and your present insurance leaves out"; "this policy will help to
			 replace your income" (when used to express loss-of-time benefits); or similar
			 words and phrases, in a manner which exaggerates any benefits beyond the terms
			 of the policy.
(e) It shall be
			 considered misleading, and therefore prohibited, for a marketing method to
			 present descriptions of a policy limitation, exception, or reduction, worded in
			 a positive manner to imply that it is a benefit, such as, describing a waiting
			 period as a "benefit builder," or stating "even preexisting conditions are
			 covered after two years." Words and phrases used in a marketing method to
			 describe such policy limitations, exceptions and reductions shall fairly and
			 accurately describe the negative features of such limitations, exceptions and
			 reductions of the policy offered.
(f) It shall be considered misleading, and
			 therefore prohibited, for the marketing of a hospital or other similar facility
			 confinement benefit to state that the amount of the benefit is payable on a
			 monthly or weekly basis, when, in fact, the amount of the benefit payable is
			 based on a daily prorata basis relating to the number of days of confinement.
			 When the policy contains a limit on the number of days of coverage provided,
			 such limit must be stated in the marketing method.
(g) It shall be considered misleading, and
			 therefore prohibited, for a marketing method of a policy covering a list of
			 specified diseases to imply coverage beyond the terms of the policy. Synonymous
			 terms shall not be used to refer to any disease so as to imply broader coverage
			 than is the fact.
(h) A marketing
			 method for a policy providing benefits for specified illnesses only, or for
			 specified accidents only, such as automobile accidents, shall be considered
			 misleading and therefore prohibited unless it shall clearly and conspicuously
			 state the limited nature of the policy. The statement shall be worded in
			 language identical to, or substantially similar to the following: "THIS IS A
			 LIMITED POLICY"; "THIS IS A SPECIFIED DISEASE ONLY POLICY"; "THIS IS AN
			 AUTOMOBILE ACCIDENT ONLY POLICY."
(i) It shall be considered misleading, and
			 therefore prohibited, for the marketing method of a direct response insurance
			 product to imply that because "no insurance agent will call and no commissions
			 will be paid to agents" that it is "a low cost plan" or use other similar words
			 or phrases because the cost of advertising and servicing such policies is a
			 substantial cost in the marketing of a direct response insurance product,
			 unless such is the fact, and is clearly substantiated in such marketing
			 method.
(j) It shall be considered
			 misleading, and therefore prohibited, for a marketing method to use
			 photographs, illustrations, depictions or fictionalized accounts of illness or
			 illness-related subjects, or overemphasis of exceptional or catastrophic risk,
			 or exaggeration of potential out-of-pocket costs of health care, or any other
			 marketing method in such a way as to invite the purchase of an insured health
			 plan for emotional rather than functional reasons.