united heritage advertising guidelines United Heritage Life Insurance Company a United Heritage Financial Group Company P.O. Box 7777 Meridian, Idaho 83680-7777 Toll Free 1-800-657-6351 www.unitedheritage.com For Producer Use Only 1 Effective 5-2013
united heritage ADVERTISING GUIDELINES What constitutes an Advertisement? To What Kind of Advertisements do these Guidelines Apply? Guidelines for Development of Advertising The Review and Approval Process Advertisement Retention What constitutes an Advertisement? Advertising includes anything which promotes our products or the Company itself to members of the general public and to potential field force members, regardless of the form or mode of transmission, including but not limited to product flyers, card pack inserts, and all the information on the United Heritage website or any other website. The concept of advertising should be construed very broadly and any questions as to whether something is or is not an advertisement should be directed to the Legal Department. The NAIC s model law on life insurance and annuity advertising generally defines an advertisement as follows: Advertisement shall be material designed to create public interest in life insurance or annuities or in an insurer, or in an insurance producer or broker; or to induce the public to purchase, increase, modify, reinstate, borrow on, surrender, replace, or retain a policy including: 1. Printed and published material, audiovisual material, and descriptive literature of an insurer, producer or broker used in direct mail, newspapers, magazines, telephone, radio, and television scripts, billboards, websites and similar displays; 2. Descriptive literature and sales aids of all kinds, authorized by the insurer, its producers or brokers, or third parties, issued, distributed, or used by such insurer, producer or broker; including but not limited to printed or electronic circulars, leaflets, booklets, depictions, illustrations, and form letters; 3. Material used for the recruitment, training, and education of an insurer s insurance producers or brokers which is also designed to be used or is used to induce the public to purchase, increase, modify, reinstate, borrow on, surrender, replace, or retain a policy; and 4. Prepared sales talks, presentations and material for use by insurance producers and brokers. Items that do not specifically appear on this list but which still constitute advertisements include lead cards and any kind of pre-sale survey. The NAIC model law also sets forth a list of items that are specifically not considered to be advertisements and thus exempt. These include: 1. Communications or materials used within the insurer s own organization and not intended for dissemination to the public; 2. Communications with existing policyholders which do not encourage the policyholder to purchase, increase, modify, or reinstate a policy; 3. Any general announcement from a group or blanket policyholder to eligible individuals on an employment or membership list that a contract or program has been written or arranged if the announcement does not describe the benefits under the contract or describe advantages as to the purchase of the contract. The definition of advertisement is broad, while the exceptions are narrowly drawn. To What Kind of Advertisements do these Guidelines Apply? Generally, these guidelines apply to any advertisement that directly or by implication mentions the Company or one of its products, regardless of who created the advertisement or who is using it. Examples of indirect or by implication advertisements are preneed surveys that do not have the Company name, but which list the Company s address as the return address for the survey, and advertisements which describe a Company product, but which never name the actual product, i.e., an annuity advertisement mentioning a product that pays 4.5% guaranteed for 5 years, but never names the Secure Value 5 Annuity or United Heritage. 2 Effective 5-2013
The model rule also sets forth the following rule: all advertisements, regardless of by whom written, created, designed or presented, shall be the responsibility of the insurer, as well as the producer who created or presented the advertisement. Insurers shall establish and at all times maintain a system of control over the content, form and method of dissemination of all advertisements of its policies. A system of control shall include regular and routine notification, at least once a year, to producers, brokers and others authorized by the insurer to disseminate advertisements of the requirement and procedures for company approval prior to the use of any advertisements that is not furnished by the insurer and that clearly sets forth within the notice the most serious consequence of not obtaining the required prior approval. Guidelines for Development of Advertising While this section is intended to be a comprehensive set of guidelines you can use to create advertisements, please be advised that, despite what appears to be a very long list, these guidelines are not exhaustive. In other words, if your proposed advertisement appears to comply with these guidelines does not necessarily mean that it will be approved for use. Further, the guidelines are not rules, and thus are open to interpretation. The basis for these cautionary statements is that the model law prohibits the use of misleading advertisements in very vague and ambiguous language, and allows the applicable regulator very wide latitude in determining whether or not an advertisement has the tendency to mislead. 1. General Guidelines. These guidelines apply to every advertisement produced by this Company or our producers. Below are guidelines that apply to specific kinds or topics of advertising i.e., advertising of preneed products, advertising of particular product benefits, and advertising of premiums. Truthful in Fact and Implication. All advertisements should be completely truthful in fact and in implication, and should not be designed to be misleading in any aspect. For example, you may include all truthful information, but present it in such a manner as to be misleading. The specific NAIC language states: No advertisement shall omit material information or use words, phrases, statements, references, or illustrations if such omission or such use has the capacity, tendency, or effect of misleading or deceiving purchasers or prospective purchasers as to the extent of any policy benefit payable, loss covered, premium payable, or state or federal tax consequences. Prohibited Terms. No advertisement shall use the terms investment, investment plan, founder s plan, charter plan, deposit, expansion plan, profit, profits, profit sharing, interest plan, savings, savings plan, private pension plan, retirement plan or other similar terms in connection with a policy in a context or under such circumstances or conditions as to have the capacity or tendency to mislead a purchaser or prospective purchaser of such policy to believe that he will receive, or that it is possible that he will receive, something other than a policy or some benefit not available to other persons of the same class and equal expectation of life. No Minimization or Obscurity. All information that must be required in an advertisement by law or by these guidelines should not minimized, obscured, or presented in an ambiguous fashion or intermingled with the text of the ad so as to make it confusing or misleading. Full Company Name and Address. If the advertisement uses the Company s name, it must be the full name United Heritage Life Insurance Company not United Heritage. Also, if the Company is named, the advertisement must also set forth the Company s address and telephone number. Trade and Group Names. An advertisement shall not use a trade name, an insurance group designation, name of the parent company of the insurer, name of a particular division of the insurer, a reinsurer of the insurer, service mark, slogan, symbol or other device or reference without disclosing the name of the insurer, if the advertisement would have the capacity or tendency to mislead or deceive as to the true identity of the insurer or create the impression that a company other than the insurer would have any responsibility for the financial obligation under a policy. Product Names and Form Numbers. If a particular product is advertised, the advertisement must state the full name of the policy; the policy number should also be noted somewhere in the advertisement. An advertisement shall not use as the name or title of a life insurance policy any phrase that does not include the words life insurance unless accompanied by other language clearly indicating it is life insurance. An advertisement shall not use as the name or title of an annuity contract any phrase that does not include the word annuity unless accompanied by other language clearly indicating it is an annuity. Governmental Programs and Agencies. No advertisement may appear to be or resemble materials used by a government program or agency or otherwise be of such a nature that they would mislead prospective insureds into believing that the solicitation is in some manner connected with a government program or agency. Of particular concern are advertisements that may appear to come from the Social Security Administration or that deal with government-conferred funeral benefits, or the taxation of certain investments. State Guarantee Associations. Advertisements should not reference or mention a state guarantee association. 3 Effective 5-2013
Stock or ownership interest. An advertisement shall not state or imply that the purchase of an insurance policy or annuity constitutes the purchase of stock in or an ownership interest in the Company. Foreign Language Advertisements. If an advertisement is in a language other than English, it must be stated in the advertisement that the policy is printed in English only and that all communication with the home office will be in English. Third Party Endorsements. If the advertisement will use a third party endorsement, there are several special requirements. It is strongly recommended that the Legal Department be included in the initial development and design of any such advertisement in order to ensure that all legal requirements are met. A.M. Best Rating. An advertisement cannot mention our A.M. Best rating or other industry rating unless the advertisement also explains the purpose of the rating and the scope of the rating. In Oregon, the advertisement must also set forth the total number of possible ratings. Company and Product Comparisons. If an advertisement compares one of our products with one sold by another insurer, the advertisement must prominently include: (1) the name of the other Company; (2) a disclaimer that the policy compared was not provided by the other Company; (3) that if the prospective purchaser has questions about the other product that they may contact the other Company; and (4) a telephone number for the other Company. Special/Limited offers. An advertisement cannot state that the Company is making a special or limited offer, or that a policy, service, premium, or benefit is available for a limited time unless the same is truthful in all aspects. For example, an offer that is available to all purchasers at any time is not a special offer. Special Class or Group. An advertisement of a particular policy shall not state or imply that prospective insureds shall be or become members of a special class, group, or quasi-group and as such enjoy special rates, dividends or underwriting privileges, unless such is a fact. Licensing status. Advertisements which are intended to be seen or heard beyond the limits of the producer s or company s licensed area shall not imply licensing beyond these limits. The advertisement may state that the insurer or producer is licensed in the state where the advertising appears, provided that it does not exaggerate such fact or imply that competing insurers or producers may not be so licensed. 2. Provisions related to product features and benefits. Graded/Modified benefits: An advertisement for a life insurance policy containing graded or modified benefits shall prominently display any limitation of benefits. If the premium is level and coverage decreases or increases with age or duration, that fact shall be disclosed. An advertisement of or for a life insurance policy under which the death benefit varies with the length of time the policy has been in force shall accurately describe and clearly call attention to the amount of minimum death benefit under the policy. No Medical Exams. If the advertisement states that no medical exam is required or that there is no physical exam or similar terms, the advertisement must state that: (1) issuance depends on truthful, correct answers to health questions; and (2) that benefits may be denied during the contestable period if the answers provided are not completely truthful and accurate. Clear Explanations. Any advertisement that mentions coverage or benefits provided by a policy must clearly explain the coverage and/or benefits. Taxation Rules. If an advertisement discusses any benefit provided by a policy that is related to federal or state taxation laws, rules, or regulations (i.e., benefits are tax free or that taxes are deferred ), all relevant tax laws, rules, or regulations must be explained in full in the advertisement. United Heritage does not provide tax advice. Dividends. An advertisement cannot state that the payment of or amount of dividends are guaranteed. Limitations on Benefits: If the amount of benefit payable or the period of a benefit is stated in an advertisement, the ad must also include the following information: (1) all the exceptions and limitations of the benefit; and (2) all the provisions regarding renewability of the policy. An advertisement cannot state a limitation or exception so it sounds like a benefit, i.e., Only a 3 month waiting period. Waiting or elimination periods should be disclosed if relevant to the text of the ad, and stated in a manner that is not misleading. Multiple Policies: If the advertisement includes a discussion of benefits provided by more than one policy, all policies must be identified and it must be stated that all advertised policies must be purchased to receive the benefits advertised. Endorsements. If the advertisement discusses an endorsement that may be added to the policy for an extra cost, the extra cost must be disclosed. Crediting and Guaranteed Interest Rates. An advertisement may not prominently advertise the current crediting interest rate if it is higher than the guaranteed rate. The current rate and guaranteed rate must be given equal prominence. 4 Effective 5-2013
Non-guaranteed policy elements. Non-guaranteed elements is defined to mean the premiums, credited interest rates (including any bonus), benefits, values, non-interest based credits, charges or elements or formulas used to determine any of these, that are subject to company discretion and are not guaranteed at issue. There are detailed requirements and limitations on the advertising of non-guaranteed elements. If the producer or company seeks to advertise any such elements, it is recommended that the General Counsel be involved in the creation of the advertisement rather than a final review thereof. 3. Guidelines related to advertisement of life insurance premiums. Non-level premiums. If a product advertised has non-level premiums, the advertisement must disclose the changes in the premium. Deposits. An advertisement cannot state that the payment of premium constitutes a deposit unless the policyholder may withdraw the full amount of funds upon demand. Premium Changes. If the Company reserves the right to change the premium on a policy but does not disclose this right in an advertisement, the advertisement is misleading. Low Cost Policies. An advertisement cannot state that a policy is low cost or use other similar language regarding the cost of the policy without providing a cost record that verifies the low cost of the premiums. Similarly, the words inexpensive, low cost, or other phrase or words of similar import cannot be used when advertising guaranteed issue policies. Premiums and Cash Values. Analogies between a life insurance policy or annuity contract s cash values and savings accounts or other investments and between premium payments and contributions to savings accounts or other investments shall be complete and accurate. An advertisement shall not emphasize the investment or tax features of a life insurance policy to such a degree that the advertisement would mislead the purchaser to believe the policy is anything other than life insurance. Withdrawal of Premiums. An advertisement shall not contain a statement or representation that premiums paid for a life insurance policy can be withdrawn under the terms of the policy. Reference may be made to amounts paid into an advance premium fund, which are intended to pay premiums at a future time, to the effect that they may be withdrawn under the conditions of the prepayment agreement. Reference may also be made to withdrawal rights under any unconditional premium refund offer. Premiums Payable for Term of Policy. An advertisement shall not represent in any way that premium payments will not be required for each year of the policy in order to maintain the illustrated death benefits, unless that is the fact. Vanishing premiums. An advertisement shall not use the term vanish or vanishing premium, or a similar term that implies the policy becomes paid up, to describe a plan using non-guaranteed elements to pay a portion of future premiums. Reduced initial premiums. A reduced initial or first year premium may not be described as constituting free insurance for a period of time. When the company charges an initial premium that differs from the amount of the renewal premium payable on the same mode, all references to the reduced initial premium shall be followed by an asterisk or other appropriate symbol which refers the reader to that specific portion of the advertisement which contains the full rate schedule for the policy being advertised. 4. Guidelines specifically applicable to preneed products In addition to the other requirements stated in this memorandum, if preneed products are advertised, the advertisement must disclose: (1) the fact that a life insurance policy or annuity contract is involved or being used to fund a prearrangement; and (2) the nature of the relationship among the soliciting producer or producers, the provider of the funeral or cemetery merchandise or services, the administrator, and any other person. 5. Guidelines related to producer-specific advertising: Professional Designations: No insurance producer may use terms such as financial planner, investment adviser, financial consultant, or financial counseling in such a way as to imply that he or she is generally engaged in an advisory business in which compensation is unrelated to sales unless that actually is the case. This provision is not intended to preclude persons who hold some form of formal recognized financial planning or consultant designation from using this designation even when they are only selling insurance. This provision also is not intended to preclude persons who are members of a recognized trade or professional association having such terms as part of its name from citing membership, providing that a person citing membership, if authorized only to sell insurance products, shall disclose that fact. This provision does not permit persons to charge an additional fee for services that are customarily associated with the solicitation, negotiation or servicing of policies. 5 Effective 5-2013
We have determined that the following designations are among those deemed to be legitimate and thus confer a meaningful advantage to a producer marketing our products: Certified Financial Planner Chartered Life Underwriter Life Underwriter Training Counsel Fellow Chartered Financial Analyst Chartered Financial Consultant Fellow, Life Management Institute Chartered Financial Analyst Certified Public Accountant If you have earned one of these designations, you are allowed to use the designation in the course of the sale of a United Heritage product. Producers also can cite post-graduate degrees if the degrees relate directly to accounting, finance, tax or insurance. While this is not an exhaustive list of acceptable designations, you are advised to cautiously evaluate the use of any designation that does not appear on this list or any future list we may publish. The use of unauthorized or misleading designations may result in the termination of your appointment with United Heritage. Senior-specific certifications Insurance producers are not authorized to use a senior-specific certification in a manner that could mislead a purchaser or prospective purchaser to believe that the insurance producer has special certification or training in advising or servicing seniors in connection with the solicitation, sale, or purchase of a life insurance or annuity product, or in the provision of advice as to the value of or the advisability of purchasing or selling a life insurance or annuity product. The use one or more words such as senior, retirement, elder, or similar words combined with one or more words such as certified, registered, chartered, advisor, specialist, consultant, planner, or similar words in the name of the certification or professional designation is prohibited. 6. Annuity Advertisements Name. An advertisement shall not use as the name or title of an annuity contract any phrase that does not include the word annuity unless accompanied by other language clearly indicating it is an annuity. An annuity advertisement shall not refer to an annuity as a CD annuity, or deceptively compare an annuity to a certificate of deposit. Deposit. An advertisement cannot say that a premium is a deposit unless the policyholder will receive a full refund upon demand. For instance, we cannot state that purchasing an annuity constitutes a deposit because there are surrender charges associated with an annuity. Miscellaneous. There are specific requirements applicable to individual deferred annuity advertisements relating to illustrations, cash surrender benefits, and determinable policy elements. 7. Confidential and Private Policyholder Information Do not use information, documentation, or any material related to any other policy or policyholder to market any policy. Doing so will not only violate our policy on privacy, but also these guidelines. The Review and Approval Process No advertisements that directly or indirectly mentions the Company or one of its products may be used by the field force until and unless that advertisement has been reviewed and approved by the Legal Department. If you consult these guidelines when developing your advertisement, it will speed up the review and Company approval process. Every effort will be made to review an advertisement within 48 hours from the date it is submitted. If an advertisement is not approved, a new submittal form should be used for the resubmission of the advertisement. If an advertisement is approved, but the producer or Company wants to later expand the area of use of the advertisement, a new submittal form should be used. Advertisement Retention State laws require that the Company maintain a file of all advertisements used by the Company and the field force for a period of five years. These laws also require the company to keep certain information regarding each piece of advertising, such as where the advertisement was used, by whom, and when. Upon approval of an advertising piece, a copy will be maintained in Legal for five years, with the additional information submitted with the advertisement. 6 Effective 5-2013