Designation Deception Creates Need For Senior Protection, Officials Say

The problem, she continued, is that requirements for designations can vary greatly. In response, rules are starting to show up that prohibit misleading use of those designations. Additionally, a proposed rule is going out to NASAA membership for a vote with the results expected in 21 days, she said.

Susan Voss, Iowa insurance commissioner and secretary-treasurer of the National Association of Insurance Commissioners, said her state put out a bulletin on the issue and that the NAIC is considering how to respond to the senior designation problems in the market. The bulletin, released on Sept. 7, 2007, notes that insurance companies are responsible for advertising of their products whether the advertising is prepared by the company or producer. It goes on to say that a producer designation is part of that advertising. Voss said that such protections should apply to consumers of all ages.

“The proliferation of titles adds to the confusion,” said Assemblyman Joseph Morelle, Rochester, N.Y. But, he also noted that advisors can say they have years of experience without actually advertising a designation, so that there are ways around new designation rules.

Ryan Wilson, a strategic policy advisor with AARP Public Policy Institute, Washington, said this is an important point because a person can legitimately be in the industry and avoid requirements that are ultimately established in states.

While Gary Sanders, senior counsel for law and government relations with the National Association of Insurance and Financial Advisors, Falls Church, Va., said his organization “strongly condemns all deception of consumers and sales practices,” he also cautioned against “throwing the baby out with the bath water.”