North Carolina Administrative Code › Title 11 - INSURANCE › Chapter 12 - LIFE AND HEALTH DIVISION › Section .0500 - ACCIDENT AND HEALTH: GENERAL NATURE › Section 12 .0520 - ACCIDENT AND HEALTH ADVERTISING: PROHIBITIONS

Current through Register Vol. 39, No. 2, July 15, 2024
No advertisement shall omit information or use words,
				  phrases, statements, references or illustrations if the omission of such
				  information or use of such words, phrases, statements, references or
				  illustrations 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.
No advertisement shall contain or use words or phrases such
				  as, "all"; "full"; "complete"; "comprehensive"; "unlimited"; "up to"; "as high
				  as"; "this policy will help fill some of the gaps that Medicare and your
				  present insurance leave 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.
An advertisement shall not contain 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 pre-existing conditions are covered after two years." Words
				  and phrases used in an advertisement 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.
No advertisement of a benefit for which payment is
				  conditional upon confinement in a hospital or similar facility shall use words
				  or phrases such as "tax free"; "extra income"; "extra pay"; or substantially
				  similar words or phrases because such words and phrases have the capacity,
				  tendency or effect to mislead the public into believing that the policy
				  advertised will, in some way, enable them to make a profit from being
				  hospitalized.
No advertisement of a hospital or other similar facility
				  confinement benefit shall advertise 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 upon a daily pro rata basis relating to the number of days of
				  confinement unless such statement of such monthly or weekly benefit amounts are
				  followed immediately by equally prominent statements of benefit payable on a
				  daily basis. When the policy contains a limit on the number of days of coverage
				  provided, such limit must appear in the advertisement.
No advertisement of a policy covering only one disease or a
				  list of specified diseases shall 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.
An advertisement for a policy providing benefits for
				  specified illnesses only, such as cancer, or for specified accidents only, such
				  as automobile accidents, shall clearly and conspicuously in prominent type
				  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 cancer only policy"; "this is an automobile
				  accident only policy."
An advertisement of a direct response insurance product shall
				  not 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.
Authority
				  G.S.
				  58-2-40(1);
				  58-63-15;
Eff.
				  February 1, 1976;
Readopted Eff. September 26, 1978;
Pursuant to
				  G.S.
				  150B-21.3A, rule is necessary without
				  substantive public interest Eff. May 1, 2018.