Standards for marketing

1. Every insurer, health care service plan, or other entity marketing long-term care insurance coverage in this state, directly or through its producers, shall: a. Establish marketing procedures to assure that any comparison of policies by its agents or other producers will be fair and accurate. b. Establish marketing procedures to assure excessive insurance is not sold or issued. c. Display prominently by type, stamp, or other appropriate means, on the first page of the outline of coverage and policy the following: "Notice to buyer: This policy may not cover all of the costs associated with long-term care incurred by the buyer during the period of coverage. The buyer is advised to review carefully all policy limitations." d. Inquire and otherwise make every reasonable effort to identify whether a prospective applicant or enrollee for long-term care insurance already has accident and sickness or long-term care insurance and the types and amounts of any such insurance. e. Every insurer or entity marketing long-term care insurance shall establish auditable procedures for verifying compliance with this subsection. f. If the state in which the policy or certificate is to be delivered or issued for delivery has a senior insurance counseling program approved by the commissioner, the insurer shall, at solicitation, provide written notice to the prospective policyholder and certificate holder that such a program is available and the name, address, and telephone number of the program. g. For long-term care health insurance policies and certificates, use the terms "noncancelable" or "level premium" only when the policy or certificate conforms to subdivision c of subsection 1 of section 45-06-05-04. 2. In addition to the practices prohibited in North Dakota Century Code section 26.1-04-03, the following acts and practices are prohibited: a. Twisting. Knowingly making any misleading representation or incomplete or fraudulent comparison of any insurance policies or insurers for the purpose of inducing, or tending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or to take out a policy of insurance with another insurer. b. High pressure tactics. Employing any method of marketing having the effect of or tending to induce the purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure to purchase or recommend the purchase of insurance. c. Cold lead advertising. Making use directly or indirectly of any method of marketing that fails to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance and that contact will be made by an insurance agent or insurance company. 3. a. With respect to the obligations set forth in this subsection, the primary responsibility of an association, as defined in subdivision b of subsection 3 of North Dakota Century Code section 26.1-45-01, when endorsing long-term care insurance is to educate its members concerning long-term care issues in general so that its members can make informed decisions. Associations shall provide objective information regarding long-term care insurance policies or certificates endorsed by such associations to ensure that members of such associations receive a balanced and complete explanation of the features in the policies or certificates that are being endorsed. b. The insurer shall file with the insurance department the following material: (1) The policy and certificate; (2) A corresponding outline of coverage; and (3) All advertisements requested by the insurance department. c. The association shall disclose in any long-term care insurance solicitation: (1) The specific nature and amount of the compensation arrangements, including all fees, commissions, administrative fees, and other forms of financial support, that the association receives from endorsement or sale of the policy or certificate to its members; and (2) A brief description of the process under which such policies and the insurer issuing such policies were selected. d. If the association and the insurer have interlocking directorates or trustee arrangements, the association shall disclose such fact to its members. e. The board of directors of associations selling or endorsing long-term care insurance policies or certificates shall review and approve such insurance policies as well as the compensation arrangements made with the insurer. f. The association shall also: (1) At the time of the association's decision to endorse, engage the services of a person with expertise in long-term care insurance not affiliated with the insurer to conduct an examination of the policies, including its benefits, features, and rates and update such examination thereafter in the event of material change; (2) Actively monitor the marketing efforts of the insurer and its agents; and (3) Review and approve all marketing materials or other insurance communications used to promote sales or sent to members regarding such policies or certificates. g. A group long-term care insurance policy or certificate may not be issued to an association unless the insurer files with the insurance department the information required in this subsection. h. The insurer may not issue a long-term care policy or certificate to an association or continue to market such a policy or certificate unless the insurer certifies annually that the association has complied with the requirements set forth in this subsection. i. Failure to comply with the filing and certification requirements of this section constitutes an unfair trade practice under North Dakota Century Code section 26.1-04-03.