By: Eiland H.B. No. 1294
A BILL TO BE ENTITLED
AN ACT
relating to the use of senior-specific certifications and
professional designations in the sale of life insurance and
annuities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The Insurance Code is amended by adding a new
Chapter 1117 to read as follows:
CHAPTER 1117.
SUBCHAPTER A. GENERAL PROVISIONS
1117.001. Purpose
The purpose of this chapter is to set forth standards to
protect consumers from misleading and fraudulent marketing
practices with respect to the use of senior-specific certifications
and professional designations in the solicitation, sale or purchase
of, or advice made in connection with, a life insurance or annuity
product.
1117.002. Scope
This chapter shall apply to any solicitation, sale or
purchase of, or advice made in connection with, a life insurance or
annuity product by an insurance agent. Nothing in this chapter
shall limit the commissioner's authority to enforce existing
provisions of the law.
1117.003. Definitions
In this chapter:
(1) "Insurance Agent" means a person required to be
licensed under the laws of this state to sell, solicit or negotiate
life insurance or annuities.
SUBCHAPTER B. USE OF SENIOR SPECIFIC CERTIFICATIONS AND
PROFESSIONAL DESIGNATIONS
1117.051. Prohibited Uses of Senior-Specific Certifications and
Professional Designations
(a) An insurance agent shall not use a senior-specific
certification or professional designation that indicates or
implies in such a way as to mislead a purchaser or prospective
purchaser that the insurance agent has special certification or
training in advising or servicing seniors in connection with the
solicitation, sale or purchase of a life insurance or annuity
product or in the provision of advice as to the value of or the
advisability of purchasing or selling a life insurance or annuity
product, either directly or indirectly through publications or
writings, or by issuing or promulgating analyses or reports related
to a life insurance or annuity product.
(b) The prohibited use of senior-specific certifications or
professional designations includes, but is not limited to, the
following:
(1) use of a certification or professional designation
by an insurance agent who has not actually earned or is otherwise
ineligible to use such certification or designation;
(2) use of a nonexistent or self-conferred
certification or professional designation;
(3) use of a certification or professional designation
that indicates or implies a level of occupational qualifications
obtained through education, training or experience that the
insurance agent using the certification or designation does not
have; and
(4) use of a certification or professional designation
that was obtained from a certifying or designating organization
that:
(A) is primarily engaged in the business of
instruction in sales or marketing;
(B) does not have reasonable standards or
procedures for assuring the competency of its certificants or
designees;
(C) does not have reasonable standards or
procedures for monitoring and disciplining its certificants or
designees for improper or unethical conduct; or
(D) does not have reasonable continuing
education requirements for its certificants or designees in order
to maintain the certificate or designation.
(b) There is a rebuttable presumption that a certifying or
designating organization is not disqualified solely for purposes of
Subsection (b)(4) when the certification or designation issued from
the organization does not primarily apply to sales or marketing and
when the organization or the certification or designation in
question has been accredited by:
(1) the American National Standards Institute (ANSI);
(2) the National Commission for Certifying Agencies;
or
(3) any organization that is on the U.S. Department of
Education's list entitled "Accrediting Agencies Recognized for
Title IV Purposes."
(c) In determining whether a combination of words or an
acronym standing for a combination of words constitutes a
certification or professional designation indicating or implying
that a person has special certification or training in advising or
servicing seniors, factors to be considered shall include:
(1) use of one or more words such as "senior,"
"retirement," "elder," or like words combined with one or more
words such as "certified," "registered," "chartered," "advisor,"
"specialist," "consultant," "planner," or like words, in the name
of the certification or professional designation; and
(2) the manner in which those words are combined.
(d) For purposes of this chapter, a job title within an
organization that is licensed or registered by a State or federal
financial services regulatory agency is not a certification or
professional designation, unless it is used in a manner that would
confuse or mislead a reasonable consumer, when the job title:
(1) indicates seniority or standing within the
organization; or
(2) specifies an individual's area of specialization
within the organization.
(e) For purposes of Subsection (d), financial services
regulatory agency includes, but is not limited to, an agency that
regulates insurers, insurance producers, broker-dealers,
investment advisers, or investment companies as defined under the
Investment Company Act of 1940.
SECTION 2. This legislation shall be become effective
January 1, 2010.