NAIC Proposed Changes to Unfair Trade Practices Model Act

[Yagents]

Do you feel like we're being targeted lately?

NAHU Washington Update - 09/30/2022

The NAIC’s exposure draft adds a definition of “insurance lead generator” to mean “any marketing-related activity or entity that publicizes the availability of an insurance, or what purports to be an insurance product or service.” The draft would also amend the Model by expanding the prohibition on unfair trade practices to insurance lead generators in addition to insurers It would also expand the scope of what is “false advertising” to include online advertisements, including those posted generally on the Internet and electronic-mail advertisements. Additionally, “insurance lead generators” would be required to maintain their books, documents and other business records related to both marketing and customer complaints for at least two years so that they will be accessible and retrievable for examination by a state’s insurance commissioner

 

[somarco]

I guess those Mega Life bandit signs would be banned as well . . .

"FINALLY . . . Affordable health insurance"

Reading the linked article, it seems that it is up to the respective state DOI to police.

FWIW, premium taxes many times are one of the largest state revenue sources . . . yet the DOI is almost always understaffed. Single complaints are rarely investigated, but when there are a number of complaints, especially directed towards a carrier, the state steps in.

The DOI also gets involved in egregious fraud, especially involving numerous complaints against a particular agent or agency. Many times agents are collecting premium payments made out to the agent/agency but they fail to remit those premiums to a carrier.

The "client" may receive a (bogus) certificate of insurance but never a policy. The types of coverage involved in this kind of fraud are lines with infrequent claims.

Carriers seem to do a reasonably good job of patrolling social media and advertising, looking for negative comments and taking appropriate action.

I do believe there is a lot of overreach that impacts agents but much of these new rules, especially at the federal level, seem to be sabre rattling more than anything with teeth.