La. Admin. Code tit. 37 § XI-1329

Current through Register Vol. 50, No. 9, September 20, 2024

Section XI-1329 - Introductory, Initial or Special Offers

1. An advertisement of an individual policy shall not directly or by implication represent that a contract or combination of contracts is an introductory, initial or special offer, or that applicants will receive substantial advantages not available at a later date, or that the offer is available only to a specified group of individuals, unless such is the fact. An advertisement shall not contain phrases describing an enrollment period as special, limited, or similar words or phrases when the insurer uses such enrollment periods as the usual method of advertising accident and sickness insurance.

2. An enrollment period during which a particular insurance product may be purchased on an individual basis shall 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 product and the opening of the new enrollment period. The advertisement shall indicate the date by which the applicant must mail the application which shall be not less than 10 days and not more than 40 days from the date that such enrollment period is advertised for the first time. This rule applies to all advertising media, i.e., mail, newspapers, radio, television, magazines and periodicals, by any one insurer. 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. The phrase any one insurer includes all the affiliated companies of a group of insurance companies under common management or control.

3. This rule prohibits any 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, unless such is the fact.

4. The phrase a particular insurance product in §1329. A.2 means an insurance policy which 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; an increase or decrease in any elimination period or waiting period from those available during an enrollment period for another policy shall not be sufficient to constitute the product being offered as a different product eligible for concurrent or overlapping enrollment periods.

B. An advertisement shall not offer a policy which utilizes a reduced initial premium rate in a manner which overemphasizes the availability and the amount of the initial reduced premium. When an insurer charges an initial premium that differs in amount from the amount of the renewal premium payable on the same mode, the advertisement shall not display the amount of the reduced initial premium either more frequently or more prominently than the renewal premium and both the initial reduced premium and the renewal premium must be stated in juxtaposition in each portion of the advertisement where the initial reduced premium appears.

C. Special awards, such as a safe drivers' award shall not be used in connection with advertisements of accident or accident and sickness insurance.

D. An advertisement using terminology to indicate that a particular form of coverage is unlike any other form of coverage presently in existence is prohibited if similar plans and offers are available.

1. An advertisement of an individual policy which provides an application or enrollment form shall contain a policy summary setting out the essential features of the policy that will be issued upon acceptance of an application by the insurer. Essential features must include language describing:

a. benefits;

b. renewability of policy;

c. right of company to change premium;

d. liability of company for pre-existing conditions;

e. waiting periods for which no benefits are payable;

f. reduction (if any) of benefits;

g. exclusions.

2. The policy summary shall be prominently displayed and readily distinguishable from all other portions of the advertisement. The policy summary shall explain the essential features of the policy in simple, concise and readily understandable language, as in the following example:

POLICY SUMMARY

(or other descriptive title)

A. This policy provides $16.27 daily hospital benefits.

B. This policy is guaranteed renewable to age 65.

C. The insurance company can change the premium.

D. Pre-existing conditions are not covered for the first two years.

E. Benefits are payable from the first day of accidents and the eighth day of sickness.

F. Benefits are reduced at age 65.

G. This policy does not cover mental illness, alcoholism or drug addiction.

H. (Other significant policy provisions.)

La. Admin. Code tit. 37, § XI-1329

Promulgated by the Department of Insurance, Commissioner of Insurance, November 1, 1973.

AUTHORITY NOTE: Promulgated in accordance with R.S. 22:2.