Table of Contents. Agent Compliance Guidance 3. Advertising Compliance Policy 5. Advertising Requirements 7. Approval Request Form 10

Transcription

1 Compliance Guidance

2 Table of Contents Agent Compliance Guidance 3 Advertising Compliance Policy 5 Advertising Requirements 7 Approval Request Form 10

3 Agent Compliance Guidance We are providing Compliance guidance to keep you informed and aware of Security Life Insurance Company of America s requirements and standards. Periodically, these requirements and standards may change and will be superseded by regulatory announcements. Communication of revisions will be provided when needed and may be sent via . Awareness and adherence to these requirements and standards along with compliance with all regulatory requirements are essential to the relationship we have with you as an agent. Any of the following practices are defined as unfair trade practices in the business of insurance, and are prohibited by Security Life s: Misrepresentations and false advertising of insurance policies (oral or written misrepresentation of benefits, advantages, conditions and terms; induce the purchase, lapse, forfeit, exchange or surrender any policy). False information and advertising generally (oral or written untrue, deceptive or misleading language in advertisements). Rebating (providing incentive or inducements to clients to purchase the contract). Churning (replacing existing business with the primary purpose of generating commissions). Recycling (replacing a Security Life policy with another Security Life policy). Failure to maintain marketing records (see your Agent and/or Producer Agreement for further details). Misrepresentation in insurance applications (for the purposes of obtaining a fee, commission or other benefit). Unfair financial planning practices (misrepresentation of credentials/professional designations). If you need further clarification on any of the above, or would like to see the full list (not all are addressed above), contact the Compliance Department or see the NAIC Model Laws for the Unfair Trade Practices Act. In addition to the Unfair Trade Practices Act, the following acts and practices are prohibited (related to advertisements): Twisting. Knowingly making any misleading representation or incomplete or fraudulent comparison of insurance policies or insurers for the purpose of inducing, or tending to induce, a person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert an insurance policy, or to take out a policy of insurance with another insurer; High Pressure Tactics. Employing a method of marketing that has the effect of inducing the purchase of insurance, or tends to induce the purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure to purchase or recommend the purchase of insurance; and Cold Lead Advertising. Making use directly or indirectly of any method of marketing that fails to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance and that contact will be made by an insurance agent or insurance company. General Compliance guidance: Advertising - In general, any materials designed to create public interest are advertisements. This includes communications directed to both insurance agents and prospective clients. See the Security Life s Advertising Policy and Advertising Requirements, found on our website, and submit all applicable materials for approval prior to use. Point of Sale - Every client requires a full explanation of his/her options in order to make informed decision for coverage. Review and discuss the brochures, disclosures and limitations and exclusions in detail to ensure your client understands the benefits and limitations of coverage.

4 Agent Compliance Guidance Point of Sale If Individual insurance, and replacement of coverage is involved, you must provide all sales materials and completed the replacement paperwork in the application packet. You must submit the signed replacement form with the application for processing. A copy of the Outline of Coverage must also be left with the client. Privacy - You are required to protect the privacy of your clients personal information. Gifts and entertainment - Exercise good judgment, and do not accept gifts that may influence, or even appear to influence, business decisions. Items above are not all-inclusive. It is your responsibility to check the laws and regulations of each state in which you do business to ensure you are in compliance with the specific requirements of those states.

5 Advertising Compliance Policy IMPORTANT NOTICE RESPONSE/COMPLIANCE REQUIRED ADVERTISING COMPLIANCE POLICY AND PROCEDURE Security Life Insurance Company of America s advertising policy requires all sales and marketing material to be approved by the home office before use. Advertising is defined by us as any written, oral or electronic material for distribution to the general public, agents and/or prospective agents, designed to: 1. Create interest in insurance in general, specific insurance products, in Security Life or a specific agent 2. Persuade any person to purchase or retain particular insurance products 3. Recruit/train agents and brokers 4. Communications intended for consumer, agent or internal use only* Advertising mediums may include but are not limited to: printed material, audio and/or video material, brochures, letters, seminars and presentations, postcards, newspapers, magazines, posters, billboards, mail, , websites, blogs, social media posts, newsletters, telephone scripts and direct sales presentations. This material must be reviewed and approved through the home office compliance process before use. *Agent only materials cannot be posted on a public website unless it is accessible only through a secure agent logon. Acknowledgement of Policy Each individual (internal/external employees, administrators, General/Producer Agents), involved in the process of creating, reviewing and approving agent/sales materials is required to be familiar and remain current with this policy, including the contents and requirements of your signed Agent and/or Producer Agreement. Violation of Policy Non-compliance with regulations, guidelines and procedures will be considered a violation of Security Life company policy and may result in disciplinary action. INSTRUCTIONS Any previously reviewed and approved, or new advertising materials that fit the description outlined above, need to be submitted for review and approval prior to use. a) Review the Advertising Requirements document and alter any materials to comply. b) Complete and submit an Approval Request Form for each advertising piece submitted. Send the advertisement(s) and request form(s) to the address provided on the Approval Request Form, or fax to The Advertising Requirements and Approval Request Form are located in this document and on our website at securitylife.com.

6 Advertising Compliance Policy c) Each advertising piece will be reviewed. Once approved, we will send you a copy of the final approved piece. We will keep a copy of the approved material and approval document. A file should be maintained in your office for each calendar year and must be retained per the Agent and/or Producer Agreement (this includes all iterations of websites/social media sites/posts). d) We will assign a company form number that must be printed on the advertisement in the lower left corner. Resubmission and approval of the advertisement is required for any changes made after the initial review/approval. Please ensure that submitted materials comply with all items in the Advertising Requirements document. This will help expedite review and sign off. We will work diligently with you to review your material fairly and responsively. The content of the material and number of pages dictates the review time, not the audience. Reprints of previously approved materials do not require pre-approval as long as there were no changes or only minor changes were made to content (e.g. spelling errors, punctuation were corrected), incorporation of previously agreed upon language/disclosures, or updated rates, and the form number has not changed.

7 Advertising Requirements The following three categories specify the applicable requirements for each. I. High Level Materials (a.k.a. Institutional Advertisement) documents, s, webpages, social media posts that include no specific reference to a product or product information. Categorized by one page or less, and may have character restrictions/limitations not set forth by us. General requirements Full Company name at its first use, never referring to less than Security Life thereafter. Ideally, the full Company address if restrictions (not of our own) are placed on the number of characters, this is not required. Otherwise, please include. If a product is mentioned, must reference that the product is underwritten by us. Ideally, the form number for the marketing/agent piece is the only item housed in the bottom left hand corner - if restrictions (not of our own) are placed on the number of characters, this is not required. Otherwise, please include. If an agent piece must display For Agent use only not to be used in a sales situation. II. Brief Description Materials (a.k.a. Invitation to Inquire cannot include rates/premium info) Categorized typically by one page or less (documents, s, webpages, social media posts/blogs) where limited/brief product descriptions are used. General requirements Full Company name at its first use, never referring to less than Security Life thereafter. If piece includes a cover page/first page, the full name is necessary on the cover/first page, and again the first time in the body of the document. Full Company address on each piece, and reference that the product is underwritten by us. If piece includes a cover page/first page the full name is necessary on the cover/first page, (it can be reiterated again within the body of the document) and reference that the product is underwritten by us. Is the marketing material truthful and not misleading in fact, by implication or omission? Is the product accurately described? Is the piece clear, complete, accurate and balanced? The form number for the marketing/agent piece is the only item housed in the bottom left hand corner of the 1 st page of the document (and should include an expiration date). Nothing else can be in this area of the form, e.g. no revision date, company tracking info etc (may be placed in the lower right corner instead). Failure to disclose any waiting or elimination periods for benefits is prohibited. If an agent piece must display For Agent use only not to be used in a sales situation. A policies trade name/marketing name needs to the words insurance policy or at the very least the use of the word insurance near the first time used, clearly identifying the fact that it is an insurance product. Calling or describing products as a plan is not allowed. The contract/policy/certification number and/or any benefit/rider form number(s), as applicable, must be located in the document somewhere (this could be at the end of the doc, and is currently housed within the required disclosure), even if only the product name is mentioned. The specific disclosure statement for this type of material, typically located at the end of the document, is required. Ads cannot imply immediate coverage if the policy is not issued within 15 business days after receipt of the application. The use or promotion of a state s insurance guaranty association is prohibited for the purpose of sales, solicitation or inducement to purchase. All text in at least 10 point font, including disclosure(s).

8 Advertising Requirements III. Standards/Requirements for all other Marketing/Consumer Brochure/Agent Materials (a.k.a. Invitation to Contract) All materials that disclose more information than the Brief Description mentioned above, regardless of type - hard copy, , website page, social media posts/blogs, etc. Also, these are requirements for any/all materials that include rates and/or premium costs. General requirements All requirements specified in the above II. Brief Description Materials also apply to these materials. Ads must describe any benefits that vary by age. Products that that are cancellable, or renewable must disclose/address the following items (as necessary for group issued policies vs. individual policies, as addressed in specific plan disclosure s): 1) "This policy is renewable at the option of the company." 2) Premium rates may change upon renewal. Ads shall disclose extent to which any loss in not covered if traceable to a condition exiting prior to the effective date of the policy. The use of preexisting condition without an appropriate definition or description shall not be used. Limitations and Exclusions for basic policy provisions must be included, including agent materials. As a Best Practice any requirements below should also be applied to II. Brief Description Materials Must include any waiting, elimination, probationary periods between the effective date of the policy and effective date of coverage. Failure to disclose any waiting or elimination periods for benefits is prohibited. Failure to disclose the amount of any deductible is prohibited. Optional/chargeable benefit(s), need to be noted as such; or when the amount of benefits chosen will vary the premium, disclose that fact. Testimonials/Statistics/Copyrighted Material Testimonials/endorsements must be true, genuine, current and applicable to the product being endorsed. They must not mislead, inflate or exaggerate the product, benefits or cost. If the spokesperson is directly or indirectly compensated, such fact must be disclosed in the advertisement. Permission to use must be documented and renewed annually. After last use, the material and permission must be retained as noted in the Agent and/or Producer Agreement, or Company Retention Policy. Paid for testimonials must disclose that fact. This includes social media likes and testimonials. If a testimonial refers to specific claim regarding benefits received under a policy, the claim date, claim number, date of loss and any other pertinent information must be provided to and retained by the insurer for inspection for a period of five years after the discontinuance of its use or publication. Statistics must be footnoted and include a source. This includes comparisons of products/policies, and/or any comments used in materials from other publications. Enough information to allow the reader to locate the information quoted must be provided. o Performance comparisons, should be current through the most recent quarter end o Newspaper/Magazine articles within three years of publication o Government (eg social security), ACA, ACLI statistics, within three years of the effective date If product comparisons are made, are they fair, accurate, and complete? They must be exact comparisons of ALL benefits of each company s product, and must not disparage or unfairly minimize competitors, their products, sales methods or agents, and be footnoted appropriately.

9 Advertising Requirements Testimonials/Statistics/Copyrighted Material (continued) Unless material (of any type, including, but not limited to: quotations, graphics, websites) is specifically noted to be copyright-free, or free for public use, permission from the original work/owner must be obtained prior to use. Linking is prohibited by copyright law. Permission to use must be documented and renewed annually. After last use, the material and permission must be retained as noted in the Agent and/or Producer Agreement, or Company Retention Policy. Lead Generating/Response Cards Any advertisement or other lead generating device, such as response cards or web site contact forms, designed to produce leads based on a response from a potential insured, should be designed to ensure compliance with state regulations and applicable portions of the Federal Communications Commission Telemarketing Sales Rule. Response cards must prominently disclose that an insurance agent may contact the applicant. The same applies to toll free telephone numbers, if as a result of calling the number an agent will contact the consumer, the material must prominently disclose that fact. The FCC allows telephone solicitations to persons with whom you have a prior business relationship. This relationship exists if the person has made an inquiry or application for product or service within the preceding three months. Note that the subject matter of the call must be limited to the subject matter of the inquiry. Response mailers/reply cards/ web site contact forms are considered a product/service inquiry. However, an agent may only contact an individual at their residential/home number within three months of the date in which the reply mailer/response card is postmarked. After three months, any residential/home phone solicitation to an individual registered on the Do-Not-Call list would be considered a violation of the FCC Do-Not-Call rules. The subject matter of the call must be limited to that of the reply mailer/response card. FCC Do-Not-Call rules apply to residential/home/cell phone solicitations only not to calls made to a business phone. Therefore, reply mailers/response cards should be designed so that residential/home numbers can be differentiated from business numbers.

10 Approval Request Form Approval Request Form Fax: Previously approved? Prior Form Number (if applicable) Form Number Assigned (by your account manager) This form must accompany each item submitted or routed for approval by the Home Office. Originated by (name) Agency Name: Name of Marketing Piece Extent of Distribution (magazine, newspaper, mail, etc) If previously approved, specifically what has changed/been updated? Quantity State (s) Target audience: (agent, policyholder, zip code, leads, etc) Additional Comments: Turn-around time standards, as defined by the Advertising Requirements document: I. High Level Materials - 1 page or less 1-2 business days II. Brief Description Materials page document 3-5 business days III. All other Materials (very detailed/new policy/plan review) 7 business days Special requests and evaluations of timing on multiple items can be discussed on an individual basis.