State Codes and Statutes
Statutes > Arkansas > Title-23 > Subtitle-3 > Chapter-96 > 23-96-10523-96-105. Advertisement of association act in insurance sales -- Notice to policy owners.
A. No person, including an insurer, agent, or affiliate of an insurer shall make, publish, disseminate, circulate, or place before the public, or cause, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in any newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or poster, or over any radio station or television station, or in any other way, any advertisement, announcement, or statement, written or oral, which uses the existence of the Arkansas Life and Health Insurance Guaranty Association for the purpose of sales, solicitation, or inducement to purchase any form of insurance covered by this chapter, except in conformity with the rules and regulations of the commissioner. In adopting such rules and regulations, the commissioner, in consultation with the board of directors of the Association, shall take into consideration the following factors: the need of the public to have confidence in the financial soundness of insurance products offered for sale in this state, the financial integrity of member insurers doing business in this state, and the role of the Association in serving as a safety net for policyowners, contract owners, insureds, and beneficiaries of impaired or insolvent insurers in this state. Provided, however, that this section shall not apply to the Arkansas Life and Health Insurance Guaranty Association or any other entity which does not sell or solicit insurance.
B. (1) (a) Within one hundred eighty (180) days of March 9, 1989, the Association shall prepare a summary document describing the general purpose and current limitations of this chapter and complying with subsection (C) of this section.
(b) This document shall be submitted to the commissioner for approval.
(c) Sixty (60) days after receiving such approval, no insurer may deliver a policy or contract described in 23-96-107(B) to a policy or contract owner unless the summary document is delivered to the policy or contract owner at the time of delivery of the policy or contract except if 23-96-107(C) applies.
(2) (a) The document should also be available upon request by a policy owner.
(b) The distribution, delivery, or contents or interpretation of this document does not guarantee that either the policy or the contract or the owner thereof is covered in the event of the impairment or insolvency of a member insurer.
(c) The description document shall be revised by the Association as amendments to this chapter may require.
(d) Failure to receive this document does not give the policy owner, contract owner, certificate holder, or insured any greater rights than those stated in this chapter.
C. (1) The document prepared under subsection (B) of this section shall contain a clear and conspicuous disclaimer on its face.
(2) The commissioner shall establish the form and content of the disclaimer.
(3) The disclaimer shall:
(a) State the name and address of the Arkansas Life and Health Insurance Guaranty Association and State Insurance Department;
(b) Prominently warn the policy or contract owner that the Arkansas Life and Health Insurance Guaranty Association may not cover the policy or, if coverage is available, it will be subject to substantial limitations, exclusions, and conditioned on continued residence in this state;
(c) State the types of policies for which guaranty funds will provide coverage;
(d) State that the insurer and its agents are prohibited by law from using the existence of the Arkansas Life and Health Insurance Guaranty Association for the purpose of sales, solicitation, or inducement to purchase any form of insurance;
(e) State that the policy or contract owner should not rely on coverage under the Arkansas Life and Health Insurance Guaranty Association when selecting an insurer;
(f) Explain rights available and procedures for filing a complaint to a violation of any provisions of this chapter; and
(g) Provide other information as directed by the commissioner including but not limited to, sources of information about financial conditions of insurers provided that the information is not proprietary and is subject to disclosure under that state's public records law.
