10127.8. (a) The purpose of this section is to assure truthful and adequate disclosure of all material and relevant information in the advertising of term life insurance which the commissioner, on the basis of an assessment of the total advertisement, determines is directed to individuals 55 years of age or older.
(b) Advertisements for term life insurance directed to individuals 55 years of age or older shall:
(1) Clearly and prominently distinguish basic life insurance benefits from suppplemental benefits such as accidental death benefits.
(2) Prominently disclose any limitations, exceptions, or reductions affecting each benefit.
(3) Prominently disclose any condition affecting the policy or certificate holder’s continued insurability. If term coverage terminates at a stated age, or at the end of any designated period, that fact and the specified age or designated period shall be disclosed.
(4) Prominently disclose any change in benefits resulting from the aging of the insured, policy duration, or any other factor.
(5) Prominently disclose any change in premium resulting from the aging of the insured, policy duration, or any other factor. If the insurer retains any right to modify premiums in the future, that fact shall be disclosed.
(c) If the benefits of the advertised policy or certificate decrease with the insured’s age or with policy or certificate duration, while the premium remains approximately constant, that fact shall, in a print or broadcast advertisement, be disclosed, in the same form and with prominence or visible duration, or both, equal to that given any positive description of benefits or the telephone number or address provided for further information or application, whichever is the most prominent.
(d) A television or radio advertisement for term life insurance directed to individuals 55 years of age or older shall in the spoken text contain the statement “policy (or certificate) benefits and limitations should be carefully examined prior to purchase.”
(e) The commissioner may, by regulation, adopt a term life insurance monetary value index, similar to the Life Insurance Surrender Cost Index of Article 12.5 (commencing with Section 2545) of Subchapter 2 of Chapter 5 of Title 10 of the California Code of Regulations, to be disclosed in all advertisements of term life insurance for individuals 55 years of age or older, and on all policies and certificates of that insurance. In developing a term life insurance monetary value index, the commissioner shall consider actual premiums and policy and certificate benefits and the manner in which they are affected with the passage of time. Any term life insurance monetary value index developed pursuant to this section shall assume an insured’s desire to retain coverage for at least 10 years.
(f) This section does not supersede or repeal any regulation of the commissioner which governs life insurance advertising and such regulation shall continue to be in force in addition to this section.
(g) The commissioner shall adopt regulations that are necessary to carry out this section.
(h) This section applies to the advertisement of individual policies of insurance and any group policies or certificates delivered or issued for delivery in this state, regardless of the situs of the contract.
(i) In addition to any other penalty provided by law or the availability of any administrative procedure, if an insurer, after notice and hearing, is found to have violated this section, or regulations adopted pursuant to this section, or knowingly permits any person to do so, the commissioner, in accordance with the procedures provided in Section 704, may suspend the insurer’s certificate of authority to transact life insurance. Section 704.7 shall apply in any proceeding conducted pursuant to this section.
(Added by Stats. 1988, Ch. 1473, Sec. 1.)
Structure California Code