Life Marketing Practices to Senior Citizens Working Group - NAIC

  • Superintendent Stokes concurred, stating that she has serious problems with providing the disclosure form after the consumer has made a decision to purchase the policy.
    • She did not feel the free-look period was an acceptable substitute for giving the disclosure information at an earlier time.
  • Commissioner Lyons said the advisory committee reported that the point of sale disclosure requirement impacted the direct marketers and other insurers who do not have individual information available to them at point of sale.

1991-1A, NAIC Proc.

  • ACLI - Ed Zimmerman, American Council of Life Insurers, expressed his concern about meaningful disclosures stating that the ACLI did not believe the proposed amendments to the Rules Governing the Advertising of Life Insurance and the Life Insurance Disclosure Model Regulation provide meaningful disclosure.
    • Specifically regarding the advertising rule, Mr. Zimmerman said it would not be possible to determine which policies fall within the parameters of this proposed language.
    • He questioned how institutional advertising should be dealt with.
    • Mr. Zimmerman offered to have the ACLI subcommittee focus on cost disclosure issues to find an appropriate way of addressing them.
    • He expressed a need for the working group to more clearly define the objectives of its work product. (p600)

1991-1A, NAIC Proceedings - Life Marketing Practices to Senior Citizens Working Group

Barbara Lautzenheiser (Lautzenheiser & Associates) requested that the comparison to a savings account be reconsidered. (601)

  • Language was also included to require that if other than guaranteed death benefits are presented in the policy, advertising, marketing materials, or verbally explained to the consumer, the agent (or company if a direct marketer) shall attach all such materials or representations to the required form before issuance of the policy. (602)

1991-1A, NAIC Proceedings

  • The third issue pertains to the column on the disclosure form which shows premiums accumulated at x% and the alleged comparison of the accumulated figure to savings accounts.
    • Commissioner Lyons reported that he anticipates additional input from the advisory committee on this issue.
    • The advisory committee stated that it is philosophically opposed to comparing the accumulated premiums to anything that is not an insurance product and added that this comparison was illegal.
  • Commissioner Lyons said all references to savings accounts were removed from the disclosure form.
    • Commissioner Lyons reported that the working group feels strongly that the disclosure form should recognize the time value of money.
    • The advisory committee requested that if the time value of money is shown, they would like the cost of insurance to be disclosed to the consumer as well.

1991-1A, NAIC - Life Marketing Practices to Senior Citizens Working Group