The NAIC model regulations on advertising state that any material designed to create public interest in life insurance, annuities, investment products, an insurer, or an insurance or investment representative is considered advertising. So you may be asking yourself – is the piece I’m designing or sending out subject to these regulations?

A piece should be considered advertising if…

  • It is used to reach multiple clients or prospects and either directed at the public at large or targeting a segment or segments of the general public (e.g., TV or radio commercials, billboards, websites, etc.).
  • It is a piece of sales literature, which is designed to be distributed to multiple clients or prospects and in which there is a measure of control over who will receive or view it (e.g., consumer brochures, direct mail ads and letters, etc.).
  • It could be used to solicit the sale of financial product, and its intent is to promote the sale of an annuity and create interest in a company or its products – even if it does not reference a specific product or company.
  • It could eventually end up in a prospect’s hands.

A piece is not considered advertising if…

  • It is used purely for internal purposes and is not intended for public dissemination or designed to create public interest in an insurer, an investment company, or its products, producers, or brokers.
  • It is designed exclusively for providing customer service to contract holders and does not promote the insurer, product changes, or new products.
  • It is being used solely for the training and education of an insurer’s producers – and is it neither product training or used to induce the public to purchase, increase, or change an insurance policy.
  • It is clearly labeled “For internal producer/agent use only – not for use with the public.”

But it may be considered advertising if…

  • It is recruiting material that is designed to attract producers to your firm.
  • It is training material that is used in conjunction with the promotion, marketing, or sale of any company products.
  • It could be seen by a client through public distribution or become embedded in an eventual client presentation, even if intended for producers.

Still curious? Visit the NAFA education website to learn about annuity advertisements and how to stay within the regulations.

In this monthly column, the National Association for Fixed Annuities (NAFA) will provide essential information about fixed annuity product features, regulation, tax issues, and industry news. We invite you, the reader, to send us any questions that you often hear — or that you may have yourself. Submit your questions to ASJeditor@AgentMedia.com with the subject line “Fixed Annuity FAQ” to have your problems answered here.

The National Association for Fixed Annuities (NAFA) is a national trade association exclusively dedicated to promoting the awareness and understanding of fixed annuities — including income, declared rate, market value adjusted, and indexed. You can follow NAFA on Twitter at www.twitter.com/nafausa.