Property & Casualty 2008Compliance Conference

Insurance Advertising in Texas

Jack Evins

Director - Advertising Unit

Consumer Protection

Purpose of Advertising Reviews

• Ensure fair competition

• Promote healthy and stable marketplace

• Help provide information to consumers that makes a difference

Long-Term Care Insurance

• Partnership policies

– Now authorized for Texas

– One-time “exchange” offer

– Reciprocity with other states not universal

Long-Term Care Insurance

• Other LTCI issues

– Suitability worksheet

– Required disclosures re: HICAP program

– Disclosures regarding compensation to associations

Certificates of Compliance

• Requirement to maintain advertising file

• Annual filing of Certificate of Compliance

• All licensed companies must file, whether they advertise or not

• TDI has updated this year’s form to promote ease of use

• Non-filers will be referred to Enforcement

“Voice” in ads

• Ads must identify the advertising insurer or agent

• Ads must not appear to be from unlicensed entities– Exception: Group master contract holders may announce

availability of group coverage to eligible/potential members

• Ads from a licensed or eligible party may include endorsements

• “Paid endorsements” must be disclosed

Lead generator ads

• Must indicate insurance/annuities are subject of solicitation

• Must disclose an insurer/agent may contact

• Events advertised as “meetings,” “seminars,” “free lunches,” etc. must also indentify event as “insurance sales presentation”

Discount Health Care Programs

• TDI regulates, as of 4/1/2010

• Discount program operators must be registered

• Advertising must distinguish discount program benefits from insurance benefits

• TDI’s Discount Health Care Programs Resource Page: www.tdi.state.tx.us/consumer/cpmdiscountprog.html

Prohibited Inducements

• Offer of noncontractual benefits is generally an offer of a “rebate”

• May offer benefit for requesting information/quote– Applies to all lines of coverage– Must disclose “No purchase required”

• Health coverages may offer noncontractual health-related information/services, but must disclose:– Not part of insurance contract– May be discontinued at any time– Subject to geographical availability (if applicable)

Changes in Advertising Filing Process

• SERFF (System for Electronic Rate & Form Filing) – late 2010

• Interstate Insurance Product Review Commission

(IIPRC or “Interstate Compact)– One-stop filing process for acceptance in multiple states– Likely available for individual long-term care insurance ads in

early 2011

Advertising Transmittal Form

• Helps with providing required information

• Reduces TDI objections/questions regarding: – Aged statistics,– Paid vs. unpaid endorsements,– Accompanying forms, and more….

• Available at: http://www.tdi.state.tx.us/forms/consumer/CP024advtrnsmtl.pdf

Medicare Supplement Changes

• Changes in plans, benefits effective 6/1/2010• All plans, including Plans K and L, must be refiled with

TDI’s Life/Health Division• Any ads reflecting benefits or “old” form numbers will

also need to be refiled• Simple substitution of form numbers may be eligible for

expedited “substantially similar” filing reviews

Social Networks

• Blogs, Twitter, Facebook, etc.• May be classified as insurance “advertisements”• Must comply with applicable requirements; e.g.,

– Disclosures – Prohibited language; e.g., defamation of competitors– Home office review of agent ads– Prior filing for TDI review (long-term care insurance, Medicare

supplements)

Conclusion: Play the Insurance Game by the Rules

• Help consumers understand the game

• Don’t include illegal participants on your team

• Respect your competitors

• Understand that consumers remember penalties

• Feel free to challenge TDI “referees” – for good cause

Questions or Need Help? Contact us!

• Advertising Unit • 512-475-1949 • advertising@tdi.state.tx.us

• Compliance Workbook: http://www.tdi.state.tx.us/consumer/advresource.html#compliance