Advertising: For insurance, it takes more than neon.
States regulate insurance in a variety of ways including controlling rates, licensing agents and regulating advertising. All states ban fraudulent statements in insurance advertising; they may also have regulations covering "misleading" statements or the disclosure of pertinent information. Information about the laws of any given state can usually be found on the state website.
Defining Advertising
State insurance-advertising regulations cover all forms of promotion: radio, cable and broadcast television, newspaper, magazine and Internet. Kansas, to give one example, identifies advertising as information directed at the public; training material and internal corporate communications aren't covered by the ad rules.
False Statements
In addition to a general ban on false statements, some states ban specific categories of falsehoods. California's code for insurance advertising forbids companies from making deliberate false statements about their financial strength and fiscal soundness; New York says companies selling long-term-care insurance must not state or imply that they're backed by the government.
Omissions
Washington state, for example, says that no insurer may omit information about its policies if that means "misleading or deceiving purchasers or prospective purchasers as to the nature or extent of any policy benefit payable, loss covered, premium payable or state or federal tax consequences." Kansas, which has similar rules, says allowing people to read the policy over before they sign doesn't get the insurer off the hook for omissions or false statements.
