Free insurance or advertisement prohibited; exceptions.

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(1) No person in this State may advertise, offer, or provide free insurance as an inducement to the purchase or sale of real or personal property or of services directly or indirectly connected with real or personal property.

(2) For the purposes of this section, "free" insurance is insurance for which no identifiable and additional charge is made to the purchaser of the real property or personal property or services or insurance for which an identifiable or additional charge is made in an amount less than the cost of the insurance as to the seller or other person, other than the insurer, providing the insurance.

(3) Subsections (1) and (2) do not apply to:

(a) insurance against loss of or damage to the real or personal property involved in any sale or services under a policy covering the interest of the seller or vendor;

(b) credit life or credit accident and health insurance;

(c) title insurance;

(d) obligations issued by insurers licensed in this State which shall indemnify against breaches of warranties made in connection with any sale or services.

(4) No person may use the word "free" to describe life or accident and health insurance in connection with the advertising or offering for sale of any kind of goods, merchandise, or services.

HISTORY: Former 1976 Code Section 38-57-170 [1947 (45) 322; 1951 (47) 433; 1952 Code Section 37-1165; 1962 Code Section 37-1165; 1978 Act No. 585, Section 15] recodified as Section 23-9-420 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-55-170 [1962 Code Section 37-1217; 1964 (53) 2293] recodified as Section 38-57-170 by 1987 Act No. 155, Section 1.


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