Property & Casualty 2008 Compliance Conference

1. Property & Casualty 2008Compliance Conference

2. Insurance Advertising in Texas

3. Jack Evins Director - Advertising Unit Consumer Protection

4. Purpose of Advertising Reviews • Ensure fair competition • Promote healthy and stable marketplace • Help provide information to consumers that makes a difference

5. Long-Term Care Insurance • Partnership policies • Now authorized for Texas • One-time “exchange” offer • Reciprocity with other states not universal

6. Long-Term Care Insurance • Other LTCI issues • Suitability worksheet • Required disclosures re: HICAP program • Disclosures regarding compensation to associations

7. 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

8. “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

9. 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”

10. 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

11. 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)

12. 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

13. 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

14. 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

15. 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)

16. 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

17. 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