(1) It is the intent of the general assembly that the purpose of this section is to provide a prospective viator with clear and unambiguous statements in the advertisement of a viatical settlement contract and to assure the clear, truthful, and adequate disclosure of the benefits, risks, limitations, and exclusions of a viatical settlement contract. This purpose is to be accomplished by the establishment of guidelines and standards of permissible and impermissible conduct in the advertising of a viatical settlement contract to assure that a product description is presented in a manner that prevents unfair, deceptive, or misleading advertising and is conducive to accurate presentation and description of a viatical settlement contract through the advertising media and material used by a licensee.
This section applies to an advertising of a viatical settlement contract or a relatedproduct or service intended for dissemination in this state, including internet advertising viewed by a person located in this state. Where disclosure requirements are established pursuant to federal regulation, this section shall be interpreted so as to minimize or eliminate conflict with federal regulation wherever possible.
Each viatical settlement licensee shall establish and at all times maintain a system ofcontrol over the content, form, and method of dissemination of an advertisement of its contracts, products, and services. An advertisement, regardless of by whom written, created, designed, or presented, is the responsibility of the licensee, as well as of the individual who created or presented the advertisement. A system of control by the licensee shall include regular notification, at least once a year, to agents and others authorized to disseminate advertisements, of the requirements and procedures for approval before the use of an advertisement not furnished by the licensee.
An advertisement shall be truthful and not misleading in fact or by implication. Theform and content of an advertisement of a viatical settlement contract shall be sufficiently complete and clear so as to avoid deception. It may not have the capacity or tendency to mislead or deceive. Whether an advertisement has the capacity or tendency to mislead or deceive shall be determined by the commissioner from the overall impression that the advertisement may be reasonably expected to create upon a person of average education or intelligence within the segment of the public to which it is directed.
(a) The information required to be disclosed pursuant to the provisions of this section may 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.
An advertisement may not omit material information or use words, phrases, statements, references, or illustrations if the omission or use has the capacity, tendency, or effect of misleading or deceiving the public as to the nature or extent of any benefit, loss covered, or state or federal tax consequence. The fact that the viatical settlement contract offered is made available for inspection before consummation of the sale, or that an offer is made to refund the payment if the viator is not satisfied, or that the viatical settlement contract includes a "free look" period that satisfies or exceeds legal requirements, does not remedy misleading statements.
An advertisement may not use the name or title of a life insurance company or a lifeinsurance policy unless the advertisement has been approved in writing by the insurer.
An advertisement may not state or imply that interest charged on an accelerated death benefit or a policy loan is unfair, inequitable, or in any manner an incorrect or improper practice.
The words "free", "no cost", "without cost", "no additional cost", or "at no extracost", or words of similar import may not be used with respect to a benefit or service unless true. An advertisement may specify the charge for a benefit or service or may state that a charge is included in the payment or use other appropriate language.
(I) Any testimonial, appraisal, or analysis used in an advertisement shall:
Be genuine;
Represent the current opinion of the author;
Be applicable to the viatical settlement contract, product, or service advertised, ifany; and
Be accurately reproduced with sufficient completeness to avoid misleading or deceiving prospective viators as to the nature or scope of any testimonial, appraisal, analysis, or endorsement.
In using any testimonial, appraisal, or analysis, the viatical settlement licensee makes as its own all the statements contained in them, and the statements are subject to all the provisions of this section.
If the individual making a testimonial, appraisal, analysis, or endorsement has afinancial interest in the viatical settlement provider or related entity as a stockholder, director, officer, employee, or otherwise, or receives a benefit, directly or indirectly, other than required union scale wages, that fact must be disclosed prominently in the advertisement.
An advertisement may not state or imply that a viatical settlement contract, benefit,or service has been approved or endorsed by a group of individuals, society, association, or other organization unless that is the fact and unless any relationship between an organization and the licensee is disclosed. If the entity making the endorsement or testimonial is owned, controlled, or managed by the licensee or receives payment or other consideration from the licensee for making an endorsement or testimonial, that fact must be disclosed in the advertisement.
If an endorsement refers to benefits received under a viatical settlement contract, allpertinent information shall be retained for a period of five years after its use.
An advertisement may not contain statistical information unless it accurately reflects recent and relevant facts. The source of all statistics used in an advertisement shall be identified.
An advertisement may not disparage insurers, viatical settlement providers, insurance producers, policies, services, or methods of marketing.
The name of the viatical settlement licensee shall be identified clearly in all advertisements about the licensee or its viatical settlement contract, products, or services, and if any specific viatical settlement contract is advertised, the viatical settlement contract must be identified either by form number or some other appropriate description. If an application is part of the advertisement, the name of the viatical settlement provider shall be shown on the application.
An advertisement may not use a trade name, group designation, name of the parentcompany of a licensee, name of a particular division of the licensee, service mark, slogan, symbol, or other device or reference without disclosing the name of the licensee if the advertisement has the capacity or tendency to mislead or deceive as to the true identity of the licensee or to create the impression that a company other than the licensee has any responsibility for the financial obligation under a viatical settlement contract.
An advertisement may not use any combination of words, symbols, or physical materials that by their content, phraseology, shape, color, or other characteristics are so similar to a combination of words, symbols, or physical materials used by a government program or agency or otherwise appear to be of such a nature that they tend to mislead prospective viators into believing that the solicitation is in some manner connected with a government program or agency.
An advertisement may state that a licensee is licensed in the state where the advertisement appears if it does not exaggerate that fact or suggest or imply that a competing licensee may not be so licensed. The advertisement may ask the audience to consult the licensee's website or contact that state's division of insurance to find out if that state requires licensing and, if so, whether the licensee or any other company is licensed.
An advertisement may not create the impression that the viatical settlement provider or its financial condition or status; the payment of its claims; or the merits, desirability, or advisability of its viatical settlement contracts are recommended or endorsed by any government entity.
The name of the actual licensee shall be stated in all of its advertisements. Anadvertisement may not use a trade name, group designation, name of any affiliate or controlling entity of the licensee, service mark, slogan, symbol, or other device in a manner that has the capacity or tendency to mislead or deceive as to the true identity of the actual licensee or create the false impression that an affiliate or controlling entity has any responsibility for the financial obligation of the licensee.
An advertisement may not, directly or indirectly, create the impression that anydivision or agency of the state or of the United States government endorses, approves, or favors:
A licensee or its business practices or methods of operation;
The merits, desirability, or advisability of a viatical settlement contract;(C) Any viatical settlement contract; or (D) Any policy or life insurance company.
If the advertiser emphasizes the speed with which the viatical settlement contractoccurs, the advertising must disclose the average time frame, from completed application to the date of offer and from acceptance of the offer to receipt of the funds by the viator.
If the advertising emphasizes the dollar amounts available to viators, the advertising shall disclose the average purchase price as a percent of face value obtained by viators contracting with the licensee during the past six months.
Source: L. 2005: Entire part added, p. 1314, § 1, effective January 1, 2006.