NAC686A.425. General requirements.

     1. Each insurer shall maintain at its home office or principal office, a complete file containing one copy of each document which it has authorized for use pursuant to this regulation. The file must contain one copy of each authorized form for a period of 3 years following the date of the last authorized use of the form.

     2. An agent shall inform the prospective purchaser, prior to commencing a life insurance sales presentation, that he or she is acting as a life insurance agent and of the full name of the insurance company which he or she is representing. In sales situations in which an agent is not involved, the insurer shall identify its full name.

     3. Terms such as “financial planner,” “investment adviser,” “financial consultant” or “financial counseling” may not be used in a way which implies that the insurance agent is generally engaged in an advisory business in which compensation is unrelated to sales, unless that is actually the case.

     4. Any reference to policy dividends must include a statement that dividends are not guaranteed.

     5. A system or presentation which does not recognize the time value of money through the use of appropriate interest adjustments may not be used for comparing the cost of two or more life insurance policies. Such a system may not be used to demonstrate the cash-flow pattern of a policy if the presentation is accompanied by a statement disclosing that the presentation does not recognize that, because of inflation, a dollar in the future may have less value.

     6. A presentation of benefits may not display guaranteed benefits and benefits which are not guaranteed as a single sum unless they are shown separately in close proximity to the single sum.

     7. A statement regarding the use of the life insurance cost indexes must include an explanation to the effect that the indexes are useful only for the comparison of the relative costs of two or more similar policies.

     8. A life insurance cost index which reflects dividends or an equivalent level annual dividend must be accompanied by a statement that it is based on the company’s current dividend scale and is not guaranteed.

     9. For the purposes of this regulation, the annual premium for a basic policy or rider for which the company reserves the right to change the premium must be the maximum annual premium.

     [Comm’r of Insurance, LH-6 § VIII, eff. 11-22-78]