Unfair Trade Practices

Mr. DeAngelo responded that the New Jersey Unfair Trade Practices Act on false advertising is only one paragraph long and the department has been criticized for not telling the industry in its regulations what is false and misleading, for example.

1999-4 NAIC Proc.

  • 3. Report of Subgroup on Unfair Trade Practices Act
    Brad Connor(Mo.), Chair of the Subgroup on the Unfair Trade Practices Act.

    • presented his written report dated Oct. 11, 1990 (Attachment Eight-B <221>). He reported that he had been given further direction from the NAIC leadership regarding the pursuit of .... the practice of agents "low-balling" insurance premium quotations.
    • 3. The subgroup will continue to investigate and suggest potential remedies or articulate currently available powers to more effectively deal with the practice of agents low-balling insurance premium quotations.

1991-1A, NAIC Proceedings

6. Adopted motion renaming the "Act Relating to Unfair Methods of Competition and Unfair and Deceptive Acts and Practices in the Business of Insurance" to the "Unfair Trade Practices Act." (52)


b. Report of Subgroup on Unfair Trade Practices
Commissioner Weaver called upon Brad Connor (Mo.) as chair of the subgroup on Unfair Trade
Practices. Mr. Connor advised that he had made a report at the Oct. 11, 1990, Washington, D.C.,
meeting regarding potential amendments to deal with unfair tying, misquotes of premium and
other related unfair trade practices. He stated that he had submitted a revised memorandum
the previous day with amendments for further consideration (Attachment Five). He advised
that the joint informal meeting of the subcommittee and advisory committee had concluded
that, while his proposals were worthy of further discussion, they may be in need of further
refinement before being considered for adoption. He asked that his report be received by the
subcommittee for further discussion and invited the industry to submit further comment.
Upon motion duly made and seconded, the report was received.

1993 4th Quarter 655

Discussion turned to development of a section defining the practices prohibited by this act. It was suggested that language

could mirror the prohibition in the Unfair Trade Practices Act. The question was raised whether the illustrations violations

were "practices" and the group agreed it would not be appropriate to require the regulator to establish practices. The language

agreed upon was "define with specificity the acts and practices that would be defined as unfair." Lester Dunlap (La.) suggested

adding language similar to the Unfair Trade Practices Act. Mr. Koch recommended the Alaska language giving the Director

the authority to define the acts and practices as unfair and deceptive. It was agreed to add the language and make sure the

penalty section made insurers subject t.o the Unfair Trade Practices Act penalties without having to find the violation a trade


Unfair Trade Practices Act
The NAIC's Model Unfair Trade Practices Act is designed to prevent deceptive and/or misleading practices during the sale of insurance.

The Model Act also provides an enforcement mechanism and a framework for regulatory action in this area.

This Act prohibits deceptive, dishonest, or unfair sales practices, as well as unfair methods of competition.

To date, 47 states have adopted some form of this Model.


Legal Cases

Fisher v. Aetna Life Ins. & Annuity Co.

39 F. Supp. 2d 508 - Dist. Court, MD Pennsylvania, 1998 - Google Scholar

Agliori v. Metropolitan Life Ins. Co.

879 A. 2d 315 - Pa: Superior Court, 2005 - Google Scholar


2015 PA Super 120 - Pa: Superior Court, 2015 - Google Scholar

Fairbanks v. Superior Court

205 P. 3d 201, 46 Cal. 4th 56, 92 Cal. Rptr. 3d … - Cal: Supreme …, 2009 - Google Scholar