On June 4, 2007, the National Association of Insurance Commissioners (NAIC) adopted the Military Sales Practices Model Regulation. The purpose of the Model Regulation is to provide uniform standards through which active duty service members of the United States Armed Forces are protected from dishonest and predatory insurance sales practices. It applies to the sale and solicitation of life and annuity products but does not apply to all insurance products.
The Model Regulation declares certain acts and practices to be false, misleading, deceptive or unfair. For example, under the Model Regulation, the following acts or practices by an insurer or insurance producer are declared to be false, misleading, deceptive or unfair when committed on a military installation or in military controlled housing:
(1) Soliciting the purchase of any life insurance product “door-to-door” or without first establishing a specific appointment for each meeting with the prospective purchaser;
(2) Soliciting service members in a group or “mass” audience or in a “captive” audience where attendance is not voluntary;
(3) Making appointments with or soliciting service members during their normally scheduled duty hours;
(4) Making appointments with or soliciting service members in barracks, day rooms, unit areas, or transient personnel housing or other areas where the installation commander has prohibited solicitation;
(5) Soliciting the sale of insurance without first obtaining permission from an office designated by the installation commander;
(6) Posting unauthorized bulletins, notices or advertisements; and
(7) Failing to present DD Form 2885, Personal Commercial Solicitation Evaluation, to persons solicited or encouraging persons solicited not to complete or submit a DD Form 2885.
Of note, the Model Regulation makes it a corrupt practice for an insurance producer to participate in any United States Armed Forces sponsored education or orientation program.
The Model Regulation declares certain acts and practices to be false, misleading, deceptive or unfair. For example, under the Model Regulation, the following acts or practices by an insurer or insurance producer are declared to be false, misleading, deceptive or unfair when committed on a military installation or in military controlled housing:
(1) Soliciting the purchase of any life insurance product “door-to-door” or without first establishing a specific appointment for each meeting with the prospective purchaser;
(2) Soliciting service members in a group or “mass” audience or in a “captive” audience where attendance is not voluntary;
(3) Making appointments with or soliciting service members during their normally scheduled duty hours;
(4) Making appointments with or soliciting service members in barracks, day rooms, unit areas, or transient personnel housing or other areas where the installation commander has prohibited solicitation;
(5) Soliciting the sale of insurance without first obtaining permission from an office designated by the installation commander;
(6) Posting unauthorized bulletins, notices or advertisements; and
(7) Failing to present DD Form 2885, Personal Commercial Solicitation Evaluation, to persons solicited or encouraging persons solicited not to complete or submit a DD Form 2885.
Of note, the Model Regulation makes it a corrupt practice for an insurance producer to participate in any United States Armed Forces sponsored education or orientation program.
Click here to view a copy of the NAIC Military Sales Practices Model Regulation.
