Annual NAIC Advertising Notice

Annual NAIC Advertising Notice NAIC Model Advertising Regulations, as well as state advertising regulations, require all insurers to provide an annual notice reminding producers of advertising review procedures and controls, and potential disciplinary actions in cases of non-compliance. Additionally, Florida law requires an insurer to provide annual notices to resident and non-resident Florida producers regarding the practice of churning (internal replacements).

Agents are required to read the Agent’s Responsibilities and Advertising Guidelines in section B of the Agent’s Manual, as well as the following notice on Florida churning. It is important to read and understand both notices.

Annual Florida Churning Notice
Under Florida regulations, an announcement must be sent to all Florida resident and non-resident agents annually. This announcement must define churning, include information on our written procedures and explain the consequences of not following the company’s procedures.

Churning: Churning is a misdemeanor of the first degree under Florida law, and occurs when the account value of an existing life insurance policy or annuity contact is used to purchase a new life insurance policy or annuity contract from the same company.

Procedures: Form D14-1180 shall be completed in triplicate at the time of sale. A copy of the form shall be provided to the customer, one copy shall be returned to The Lafayette Life Insurance Company and one copy shall be retained by the agent. The new contract will not be issued until Form D14-1180 is received, and a copy of the completed form shall be retained in the customer’s file at the home office.

Consequences of non-compliance with these churning procedures may be imposition of an administrative fine by the Florida Department of Insurance and would be grounds for termination of an agent’s contract. Lafayette Life does not condone or endorse churning. Please be aware of the above information regarding Florida requirements.