760 Ind. Admin. Code 1-18-4
Authority: IC 27-1-3-7
Affected: IC 27-4-1-4
Sec. 4.
Section B. STANDARDS. ADVERTISEMENTS IN GENERAL. Advertisements shall be truthful and not misleading in fact or in implication. Words or phrases the meaning of which is clear only by implication or by familiarity with insurance terminology shall not be used. Interpretation of Section B 1
The purpose of the first sentence of Section B 1 is twofold. First, it states the general purpose of the Rules [ 760 IAC 1-18 ] by prohibiting advertisements which are not only false but which may mislead either in fact or by implication. It does for instance recognize that advertisements may be misleading even though literally true and capable of proof. Secondly, it establishes a broad principle designed to prohibit untruthful and misleading advertisements in addition to those principles covered by specific sections of the Rules [ 760 IAC 1-18 ]. To that extent it may be considered a "catch-all" rule.
The second sentence of this section is intended to prohibit the use of incomplete statements and words or phrases which, because of the reader's unfamiliarity with insurance terminology, have the tendency and capacity to mislead or deceive. It places no prohibition on the use of any particular words or phrases but does require that all terminology used in an advertisement, whether it be insurance terminology or otherwise, be sufficiently clear so as to avoid being misleading. In interpreting this particular portion of Section B 1, it must be recognized that insurance terminology is often essential to properly explain the coverage being advertised.
As a general principle, words or phrases which are commonly understood by the public with respect to insurance, for example, such words or phrases as premiums, policies, contracts, reinstatement, lapse, grace period, capital, assets, investments, legal reserve, insurer, insured, policyholders, insurance company and insurance usually need not be further clarified in the context of the advertisement. However, certain words or phrases may, unless adequately clarified in the context of the advertisement, mislead those who are not familiar with insurance terminology.
760 IAC 1-18-4