| (C) An advertisement may not state or imply that illustrated dividends under either or both a participating policy or pure endowment will be or can be sufficient at any future time to assure without the future payment of premiums, the receipt of benefits, such as a paid-up policy, unless the advertisement clearly and precisely explains the benefits or coverage provided at such time and the conditions required for that to occur. (D) An insurer or agent may not, as an inducement to purchase insurance circulate, publish, or otherwise exhibit to any person who is an insured or prospective insured a form of director resolution, stockholders resolution, or form of company action that states or implies the action an insurer will take in the future as respects a declaration of dividend or other such matter if the insurer, its directors, or its stockholders are not bound to take the action stated or implied or if the insurer does not presently have the earnings or the funds or assets to make payments or to consummate the transaction in accordance with the appropriate statutes and rules if any. (5) Unlawful inducement. An insurer may not make or include in any advertisement a statement or reference that implies that the purchaser or prospective purchaser by purchasing a policy of insurance will become a member of a limited group of persons who will or may receive special advantages from the company not provided for in the policy or not authorized by law or state or imply that the prospective insured will receive favored treatment in the payment of dividends especially if the policy advertised is a participating policy not available to persons holding other types of participating or nonparticipating policies issued by the insurer to individuals of the same class and equal expectation of life nor to that class of persons to whom essentially the same hazards are attributable. This is not intended to prohibit and does not prohibit the lawful payment of differing amounts of dividends on different classes of policies. The term "class" relates to the recognized underwriting classifications such as age, health, occupation, sex, hazardous potential, and similar classifications that determine the nature of the risk assumed, and the term "class" as used in this paragraph is not limited to a particular plan or policy form or the date of issue of a policy. (6) An insurer or agent may not as a "twisting" or other device, inform any policyholder or prospective policyholder that any insurer was required to change a policy or contract form or related material to comply with the provisions of this division or other rules or statutes. This section is ordered for such reasons as those stated in §21.113(j) of this division (relating to Rules Pertaining Specifically to Accident and Health Insurance Advertising and Health Maintenance Organization Advertising). (7) Deception as to introductory, initial, or special offers. (A) An advertisement of a particular policy may not state or imply that prospective policyholders become group or quasi-group members that, as such, enjoy special rates or underwriting privileges ordinarily associated with group insurance as recognized in the industry unless such is the fact. (B) If an insured or prospective insured has been provided a policy or coverage of insurance without first having paid a premium or returned an application to the insurer or its agents or representatives, the insurer, its agents, or representative may not make any billing or attempt to collect a premium on such policy until such time as an application or acknowledgment of acceptance by the insured is received. When coverage is issued prior to such acceptance, it shall be accompanied by a written statement describing it as follows: (i) giving the facts concerning the delivery of the policy and whether or not the policy was requested by the insured; and (ii) stating that the insured is under no obligation to pay the insurer if he does not want to initiate or continue the coverage; and (iii) clearly stating when coverage will be effective. (C) An advertisement by an insurer may not state or imply, that a policy or combination of policies is an introductory, initial, special, or limited offer and that applicants will receive advantages by accepting the offer or that such advantages will not be available at a later date unless such is the fact. An advertisement may not contain phrases describing an enrollment period as "special," "limited," or similar words or phrases if the insurer uses such enrollment periods as the usual method of advertising insurance. (i) An enrollment period during which "a particular insurance product" may be purchased on an individual basis may not be offered within this state unless there has been a lapse of not less than three months between the close of the immediately preceding enrollment period for the same or substantially the same product and the opening of the new enrollment period. The advertisement shall indicate the date by which the applicant must mail the application which may not be less than 10 days and not more than 40 days from the date that such enrollment period is advertised for the first time. This section applies to all advertising media: i.e., mail, newspaper, radio, television, magazine, and periodicals. It is inapplicable to solicitation of employees or members of a particular group or association which otherwise would be eligible under specific provisions of the Insurance Code for group, blanket, or franchise insurance. This section applies to all affiliated companies under common management or control. The phrase "a particular insurance product" as used herein is an insurance policy that provides substantially different benefits than those contained in any other policy. Different terms of renewability, an increase or decrease in the dollar amounts of benefits, or an increase or decrease in any elimination period or waiting period from those available during an enrollment period for another policy are not sufficient to constitute the product being offered as a different product eligible for concurrent or overlapping enrollment periods. (ii) There may not be a statement or implication to the effect that only a specific number of policies will be sold, or that a time is fixed for the discontinuance of the sale of the particular policy advertised because of special advantages available in the policy. |
| Source Note: The provisions of this §21.114 adopted to be effective February 1, 1981, 5 TexReg 3336; amended to be effective September 29, 1998, 23 TexReg 9752; amended to be effective December 9, 2007, 32 TexReg 8830; amended to be effective February 11, 2009, 34 TexReg 843; amended to be effective September 8, 2010, 35 TexReg 8117 |
