North Dakota Administrative Code › Title 45 - Insurance, Commissioner of › Article 45-16 - Life Settlements › Chapter 45-16-02 - Life Settlement Advertising › Section 45-16-02-03 - Disclosure requirements

Current through Supplement No. 393, July, 2024
1.
				Advertisements must be accurate and truthful and not misleading in fact or by
				implication. The form and content of an advertisement of a life settlement
				contract shall be sufficiently complete and clear so as to avoid deception. It
				shall not have the capacity or tendency to mislead or deceive. Whether an
				advertisement has the capacity or tendency to mislead or deceive shall be
				determined by the commissioner from the overall impression that the
				advertisement may be reasonably expected to create upon a person of average
				education or intelligence within the segment of the public to which it is
				directed.
2. A person or trust may
				not directly or indirectly market, advertise, solicit, or otherwise promote the
				purchase of a policy for the sole purpose of or with an emphasis on settling
				the policy.
3. The information
				required to be disclosed under this section 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.
a. An advertisement shall not omit material
				information or use words, phrases, statements, references, or illustrations if
				the omission or use has the capacity, tendency, or effect of misleading or
				deceiving owners as to the nature or extent of any benefit, loss covered,
				premium payable, or state or federal tax consequence. The fact that the life
				settlement contract offered is made available for inspection prior to
				consummation of the sale, or an offer is made to refund the payment if the
				owner is not satisfied or that the life settlement contract includes a
				free-look period that satisfies or exceeds legal requirements, does not remedy
				misleading statements.
b. An
				advertisement shall not use the name or title of a life insurance company or a
				life insurance policy unless the advertisement has been approved by the
				insurer.
c. An advertisement shall
				not state or imply that interest charged on an accelerated death benefit or a
				policy loan is unfair, inequitable, or in any manner an incorrect or improper
				practice.
d. The words "free", "no
				cost", or words of similar import may not be used in the marketing,
				advertising, soliciting, or otherwise promoting of a life settlement contract.
				An advertisement may specify the charge for a benefit or a service or may state
				that a charge is included in the payment or use other appropriate language.
e. Testimonials, appraisals, or
				analysis used in advertisements must be genuine; represent the current opinion
				of the author; be applicable to the life settlement contract advertised, if
				any; and be accurately reproduced with sufficient completeness to avoid
				misleading or deceiving prospective owners as to the nature or scope of the
				testimonials, appraisal, analysis, or endorsement. In using testimonials,
				appraisal, or analysis, a licensee under this chapter makes as its own all the
				statements contained therein and the statements are subject to all the
				provisions of this section.
(1) If the
				individual making a testimonial, appraisal, analysis, or an endorsement has a
				financial interest in the party making use of the testimonial, appraisal,
				analysis, or endorsement, either directly or through a related entity as a
				stockholder, director, officer, employee, or otherwise, or receives any benefit
				directly or indirectly other than required union scale wages, that fact shall
				be prominently disclosed in the advertisement.
(2) An advertisement shall not state or imply
				that a life settlement contract has been approved or endorsed by a group of
				individuals, society, association, or other organization unless that is the
				fact and unless any relationship between an organization and the life
				settlement licensee is disclosed. If the entity making the endorsement or
				testimonial is owned, controlled, or managed by the life settlement licensee,
				or receives any payment or other consideration from the life settlement
				licensee for making an endorsement or testimonial, that fact shall be disclosed
				in the advertisement.
(3) When an
				endorsement refers to benefits received under a life settlement contract, all
				pertinent information shall be retained for a period of five years after its
				use.