Iowa Admin. Code r. 191-15.8
Current through Regsiter Vol. 46, No. 26, June 12, 2024
Rule 191-15.8 - Producer responsibilities(1)Required disclosures. A producer shall inform the prospective purchaser, prior to commencing an insurance sales presentation, that the producer is acting as an insurance producer and inform the prospective purchaser of the producer's full name and the full name of the insurance company that the producer will represent in the insurance sales presentation. In sales situations in which a producer is not involved, the insurer shall identify the insurer's full name to a prospective purchaser.(2)Improper sales tactics.a. Producers and insurers shall not employ any method of marketing or tactic that uses undue pressure, force, fright, threat, whether explicit or implied, to solicit the purchase of insurance.b. A producer shall not: (1) Execute a transaction for an insurance customer without authorization by the customer to do so; or(2) Commit any act that shows that the producer has exerted undue influence over a person.c. Producers and insurers shall not, without good cause: (1) Fail or refuse to furnish any individual, upon reasonable request, information to which that individual is entitled, or to respond to a formal written request or complaint from any individual.(2) Sell an insurance policy or rider to an individual that is a duplication of a policy or rider that the individual owns or for which the individual has applied at the time of the sale.(3)Prohibited designations and fees.a. When an insurance producer is engaged only in the sale of insurance policies or annuities, the insurance producer shall not hold the producer out, directly or indirectly, to the public as a "financial planner," "investment adviser," "consultant," "financial counselor," or any other specialist solely engaged in the business of financial planning or giving advice relating to investments, insurance, real estate, tax matters or trust and estate matters. This provision does not preclude insurance producers who hold some form of formal recognized financial planning or consultant certification or designation from using this certification or designation when they are only selling insurance.b. An insurance producer shall not engage in the business of financial planning without disclosing to the client prior to the execution of the agreement required by paragraph 15.8(3)"c" or to the solicitation of the sale of a product or service that the producer is also an insurance producer and that a commission for the sale of an insurance product will be received in addition to a fee for financial planning, if such is the case. The disclosure requirement under this paragraph may be met by including the disclosure in any disclosure required by federal or state securities law.c. An insurance producer shall not charge fees other than commissions unless such fees are based upon a written agreement signed by the client in advance of the performance of the services under the agreement. A copy of the agreement must be provided to the client at the time the agreement is signed by the client. The agreement must specifically state: (1) The service for which the fee is to be charged;(2) The amount of the fee to be charged or how it will be determined or calculated; and(3) That the client is under no obligation to purchase any insurance product through the insurance producer or consultant. The insurance producer shall retain a copy of the agreement for not less than three years after completion of services, and a copy shall be available to the commissioner upon request.
d. Producers shall not charge an additional fee for services that are customarily associated with the solicitation, negotiation or servicing of policies. This prohibition shall not apply to assigned risk policies and commercial property and casualty policies. Any additional fee that a producer intends to charge for assigned risk policies and commercial property and casualty policies must be fully disclosed to the insured.e. Producers shall comply with rule 191-10.19 (522B) in using senior-specific certifications and professional designations in the sale of life insurance and annuities.(4)Suitability. A producer shall not recommend to any person the purchase, sale or exchange of any life insurance policy, or any rider, endorsement or amendment thereto, without reasonable grounds to believe that the transaction or recommendation is not unsuitable for the person based upon reasonable inquiry concerning the person's insurance objectives, financial situation and needs, age and other relevant information known by the producer. For purposes of this subrule, when a producer recommends a group life insurance policy, "person" shall refer to the intended group policyowner.(5)Prohibited acts.a. For purposes of this subrule: "Gift" means a rendering of anything of value in return for which legal consideration of equal or greater value is not given and received.
"Immediate family" shall include parent, mother-in-law, father-in-law, spouse, former spouse, brother, sister, brother-in-law, sister-in-law, son-in-law, daughter-in-law, child and stepchild. In addition, "immediate family" shall include any other person who is supported, directly or indirectly, to a material extent by a producer.
"Loan" means an agreement to advance property, including but not limited to money, in return for the promise that payment will be made for use of the property.
b. A producer shall not: (1) Solicit or accept, directly or indirectly, at any time, a personal loan from an insurance customer that in the aggregate exceeds $250, unless the customer is: 1. A bank, savings and loan, credit union or other recognized lending entity; or2. A member of the producer's immediate family.(2) Solicit or accept, directly or indirectly, at any time, a gift to the producer or to a member of the producer's immediate family from an insurance customer that in the aggregate exceeds $250, unless the customer is a member of the producer's immediate family. A gift to a member of the producer's immediate family shall be included in calculating the aggregate amount. A gift received by a member of the producer's immediate family from a customer that is not a member of the producer's immediate family in excess of the aggregate amount shall be deemed a violation of this subrule by the producer.(3) Solicit or accept being named as a beneficiary, executor or trustee in a will, trust, insurance policy or annuity of a customer, unless the customer is a member of the producer's immediate family.(4) Evade or otherwise violate the spirit of this subrule by terminating a producer relationship with an insurance customer for the purpose of soliciting or accepting a loan or a gift, or for the purpose of being named as a beneficiary, executor or trustee in a will, trust, insurance policy or annuity that the producer otherwise would have been prohibited from soliciting or accepting by this subrule. A producer will not be in violation of this subrule if the producer has made a bona fide termination of the producer relationship with the insurance customer and has conducted no insurance or other business with the insurance customer for a period of three years.c. Transactions that involve nominal interim ownership immediately precedent to transfer of ownership into a trust are exempt from this subrule.Iowa Admin. Code r. 191-15.8
Adopted by IAB March 20, 2024/Volume XLVI, Number 19, effective 4/24/2024