South Carolina Code of Regulations › Chapter 69 - DEPARTMENT OF INSURANCE › Section 69-20 - Campus Life Insurance

Current through Register Vol. 48, No. 6, June 28, 2024
Complaints and abuses related to life insurance sold on or around
			 the campuses of our universities and colleges have grown to intolerable
			 proportions bringing into disrepute not only such campus life insurance but all
			 life insurance. In particular, practices surrounding the making and acceptance
			 of notes signed by the student-insured for the first-year premium with payment
			 of such notes to be made out of the cash values of the policy at some future
			 time has given rise to constant misunderstandings and has constituted a vehicle
			 for fraudulent, deceptive, or misleading practices. In particular, failure to
			 disclose adequately and clearly that lapse of the policy for any reason renders
			 the note due and payable immediately has constituted a constant source of
			 friction and complaint.
Accordingly, we propose to issue the following regulations
			 relating to the sale and marketing of campus life insurance:
1. Purposes. The purpose of these regulations
		  is to prohibit false, deceptive or misleading practices in respect to the
		  marketing of campus life insurance and so to regulate the sale or attempted
		  sale of campus life insurance as to prevent such practices in connection with
		  the sale or attempted sale of such insurance.
2. Definition. "Campus Life Insurance" is
		  hereby defined to mean any program of life insurance, including supplemental
		  benefits, such as waiver of premium, accidental death, or like benefits, sold
		  to university or college students under such circumstances that the premium, or
		  any part thereof, for the first or any following year of coverage is deferred
		  or is made through the execution of a promissory note or similar
		  instrument.
3. Applicability of
		  Premium Service Company Act or other laws. Nothing herein shall be deemed to
		  supersede the Premium Service Company Act, nor any other law otherwise
		  applicable, nor to suggest that the Premium Service Company Act, or other law,
		  is not applicable to the financing of premiums for campus life
		  insurance.
4. Registration and
		  Approval.
(1) No insurer conducting or
		  proposing to conduct a campus life insurance program, and no agent, broker, or
		  other person conducting or proposing to conduct such a program shall do so, or
		  continue to do so, unless such insurer, agent, broker, or other person shall
		  first file with the Chief Insurance Commissioner (Commissioner) notice of
		  intent to conduct such program and receive from the Commissioner his approval.
		  Such approval shall not be granted by the Commissioner unless the insurer,
		  agent, broker, or other person has filed with him a copy of every promissory
		  note or other security instrument, brochure, pamphlet, circular, flyer, leaflet
		  or other advertising or sales piece together with a copy of every planned or
		  prepared oral presentation to be made in connection with the sale or attempted
		  sale of campus life insurance; nor shall the Commissioner grant such approval
		  unless he finds all of such material to be complete, fair, unambiguous, and
		  free from any tendency to mislead, deceive or confuse the student to whom it is
		  to be addressed.
(2) No such
		  insurer, agent, broker, or other person conducting or proposing to conduct a
		  campus life insurance program on or about the campus of any university or
		  college shall do so or continue to do so unless it or he shall first register
		  with the president, dean, or other authorized official of such university or
		  college and provide such official with evidence of the Commissioner's approval.
		  Nothing herein shall be deemed to limit or impair the right of any authorized
		  official of a university or college to impose other or further limitations in
		  respect to sales on campus or to prohibit such sales in accordance with the
		  rules of the particular institution.
(3) The Commissioner may, after due notice
		  and public hearing, withdraw any such approval previously granted by him for
		  any reason which would have justified his refusal to grant approval had the
		  reason then existed or been known; and upon withdrawal of such prior approval,
		  the Commissioner shall so advise the president, dean or other authorized
		  official of every such university or college.