North Carolina Administrative Code › Title 11 - INSURANCE › Chapter 12 - LIFE AND HEALTH DIVISION › Section .0400 - LIFE: GENERAL NATURE › Section 12 .0427 - LIFE INSURANCE ADVERTISING: DISCLOSURE REQUIREMENTS

Current through Register Vol. 39, No. 2, July 15, 2024
(a) The
				information required to be disclosed by
				11 NCAC
				12 .0424 to
				12 .0433 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.
(b) No advertisement shall omit material
				information or use words or phrases in other than their customary insurance
				meaning 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.
(c)
				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.
(d) An
				advertisement shall not use as the name or title of a life insurance policy any
				phrase that does not include the words "life insurance" unless accompanied by
				other language clearly indicating it is life insurance.
(e) An advertisement shall prominently
				describe the type of policy advertised.
(f) An advertisement of a policy marketed by
				the direct response techniques shall not state or imply that because there is
				no agent or commission involved there will be cost saving to prospective
				purchasers unless such is the fact.
(g) 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.
(h) An advertisement for a policy with
				non-level premiums shall prominently describe the premium changes.
(i) Nonguaranteed Policy Elements:
(1) An advertisement shall not utilize or
				describe nonguaranteed policy elements in a manner that is misleading or has
				the capacity or the tendency to mislead.
(2) An advertisement shall not state or imply
				that the payment or amount of nonguaranteed policy elements is guaranteed. If
				nonguaranteed policy elements are illustrated, they must be based on the
				insurer's current scale and the illustration must contain a statement to the
				effect that they are not to be construed as guarantees or estimates of amounts
				to be paid in the future.
(3) An
				advertisement that includes any illustrations or statements containing or based
				upon nonguaranteed elements shall set forth with equal prominence comparable
				illustrations or statements containing or based upon the guaranteed
				element.
(4) If an advertisement
				refers to any nonguaranteed policy element, it shall indicate that the insurer
				reserves the right to change any such element at any time and for any reason.
				However, if an insurer has agreed to limit this right in any way, such as, for
				example, if it has agreed to change these elements only at certain intervals or
				only if there is a change in the insurer's current or anticipated experience,
				the advertisement may indicate any such limitation of the insurer's
				right.
(5) An advertisement shall
				not refer to dividends as "tax free"use words of similar import, unless the tax
				treatment of dividends is fully explained and the nature of the dividend as a
				return of premium is indicated clearly.