by John Darer CLU ChFC CSSC
A number of structured settlement firms operating in New York State STILL appear to be violating New York State Law. An April 28, 2008 opinion of New York Insurance Department Office of General Counsel (OGC) clarifies advertising rules and underscores the warnings that I have previously posted on this blog. The insurance advertising statute opined on by the OGC, applies to ALL advertisements, regardless of the medium through which they are disseminated- whether radio, the Internet or print .
N.Y. Ins. Law § 2101(k) (McKinney 2006) defines “insurance producer” as “an insurance agent, insurance broker, reinsurance intermediary, excess lines broker, or any other person required to be licensed under the laws of this state to sell, solicit, or negotiate insurance. . . .”
Questions Presented
1. Must an insurance producer, in any radio or print advertisement that mentions an insurer that the insurance producer represents, also mention the location of the insurer’s principal office pursuant to Insurance Law § 2122(b) if the advertisement does not provide any rating information, but may refer to the types of coverage offered by the insurer, as well as the insurer’s claims-handling methods?
2. May an insurance producer lawfully use an insurer’s logo (with the insurer’s permission) on the insurance producer’s website advertisement without providing the full name and location of that insurer?
Conclusions:
1. Yes. Under Insurance Law § 2122(b), an insurance agent or broker shall, in all advertisements or public announcements that refer to an insurer, also include the city, town or village in which the insurer has its principal office. The Insurance Law does not make a distinction between the types of media through which the advertisement is disseminated.
2. No. The use of only an insurer’s logo in advertisements without setting forth the insurer’s full name and principal office location violates Insurance Law § 2122(b), which requires insurance agents and brokers to set forth the full name and the city, town or village of an insurer’s principal office in any advertisement that refers to such insurer. Moreover, the use of only an insurer’s logo also may violate Article 24 of the Insurance Law, which governs unfair methods of competition and unfair and deceptive acts and practices, as well as the Insurance Department’s regulations.
The April 28, 2008 OGC opinion, which came days after my April 24, 2008 post, follows a January 7, 2008 OGC opinion on the same subject. This is my 3rd blog post on the subject. This compliance issue is unfortunately common to all orientations of structured settlement and settlement planning consultants.
If you or your firm is licensed as an "insurance producer" as defined in New York State insurance law, perhaps it is now a good time check your website and your print advertising to see if you and/or your firm are compliant. I speculate that many of you will be unpleasantly surprised.
While the compliance issue is not confined to a single firm, one of the firms in question, Forge Consulting, LLC is purportedly behind a pending, but flawed (more on that in another post) New York State bill designed, among other things to shore up compensation rights for plaintiff structured settlement consultants. On what ground does Forge Consulting, LLC stand on if on the one hand it is proposing new laws and on the other hand is not compliant with others?
Click here for a copy of the April 28, 2008 opinion
Is your Insurance Advertising in Compliance With New York Insurance Advertising Law January 29, 2008
http://ads.sixapart.com/custom?id=1000002898807&width=300&height=250&js=1
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