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85. Wisconsin Laws & Ethics

85.7. Unfair Marketing Practices

Misrepresentation, Rebating & Discrimination

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Wisconsin groups its main marketing prohibitions under s. 628.34 and ss. Ins 6.54, 6.55. The categories are:

Misrepresentation
Unfair inducements (rebating)
Unfair discrimination
Restraint of competition
Unfair restriction of contracting parties’ choice of insurer
Extra charges
Attempt to unduly influence employers
Unfair use of official position Each one deserves its own treatment.

Misrepresentation

It’s a violation for intermediaries (and their employees or anyone acting on their behalf) to make any written or oral communication about any insurance contract, the insurance business, any insurance company, or any intermediary that contains false or misleading information. The definition specifically includes:

Information that’s misleading because of incompleteness.
Filing a report with intent to deceive the person examining it.
Making a false entry in a record.
Failing to make a proper entry in a record for the purpose of concealing information.
Using a name, slogan, emblem, or related device that will or is likely to cause an intermediary to be mistaken for another intermediary. If an intermediary distributes cards or documents, exhibits signs, or publishes advertisements (including social media posts) that include misrepresentations and reference a particular insurer the intermediary represents, the violation carries a presumption that the insurer also committed the violation. So the insurer is on the hook with the intermediary.

Real-World Examples

OCI has flagged each of the following as misrepresentation:

Telling a 77-year-old that a Medicare supplement policy “pays every expense not covered by Medicare” or “fills all the gaps.” No supplement does that.
Sending a Facebook message to a customer claiming their current health insurer is “financially unsound” and its agents are “crooks” without provable basis.
Posing as a Social Security Administration representative to gain access to a customer’s home, when the real purpose is selling insurance.
Handing out business cards identifying yourself as an agent for an ins

Wisconsin Marketing Prohibitions Overview

Governed by s. 628.34 and ss. Ins 6.54, 6.55
Eight main categories:
- Misrepresentation
- Unfair inducements (rebating)
- Unfair discrimination
- Restraint of competition
- Unfair restriction of contracting parties’ choice of insurer
- Extra charges
- Attempt to unduly influence employers
- Unfair use of official position

Misrepresentation

Violation: intermediaries (or anyone acting for them) making false/misleading written or oral communication about:
- Insurance contracts, the insurance business, any insurer, or any intermediary
Specifically includes:
- Misleading info due to incompleteness
- Filing reports intending to deceive examiner
- Making false entries in records
- Failing to make proper entries to conceal information
- Using names/slogans/emblems likely to cause confusion with another intermediary
Insurer liability:
- If intermediary’s misrepresentation (cards, signs, ads, social media) references a specific insurer, violation presumed against insurer too
- Insurer and intermediary jointly responsible

Real-World Examples of Misrepresentation

False claims Medicare supplement “pays every expense” or “fills all gaps”
Unsubstantiated claims competitor insurer is “financially unsound” or agents are “crooks”
Impersonating a Social Security Administration representative to gain home access for sales purposes
Misrepresenting identity/affiliation on business cards

Next | 85.7.2 Restraint, Restrictions & Other Prohibited Practices

Misrepresentation, Rebating & Discrimination

Wisconsin groups its main marketing prohibitions under s. 628.34 and ss. Ins 6.54, 6.55. The categories are:

Misrepresentation
Unfair inducements (rebating)
Unfair discrimination
Restraint of competition
Unfair restriction of contracting parties’ choice of insurer
Extra charges
Attempt to unduly influence employers
Unfair use of official position Each one deserves its own treatment.

Misrepresentation

Information that’s misleading because of incompleteness.
Filing a report with intent to deceive the person examining it.
Making a false entry in a record.
Failing to make a proper entry in a record for the purpose of concealing information.
Using a name, slogan, emblem, or related device that will or is likely to cause an intermediary to be mistaken for another intermediary. If an intermediary distributes cards or documents, exhibits signs, or publishes advertisements (including social media posts) that include misrepresentations and reference a particular insurer the intermediary represents, the violation carries a presumption that the insurer also committed the violation. So the insurer is on the hook with the intermediary.

Real-World Examples

OCI has flagged each of the following as misrepresentation:

Telling a 77-year-old that a Medicare supplement policy “pays every expense not covered by Medicare” or “fills all the gaps.” No supplement does that.
Sending a Facebook message to a customer claiming their current health insurer is “financially unsound” and its agents are “crooks” without provable basis.
Posing as a Social Security Administration representative to gain access to a customer’s home, when the real purpose is selling insurance.
Handing out business cards identifying yourself as an agent for an ins

Key points

Wisconsin Marketing Prohibitions Overview

Governed by s. 628.34 and ss. Ins 6.54, 6.55
Eight main categories:
- Misrepresentation
- Unfair inducements (rebating)
- Unfair discrimination
- Restraint of competition
- Unfair restriction of contracting parties’ choice of insurer
- Extra charges
- Attempt to unduly influence employers
- Unfair use of official position

Misrepresentation

Violation: intermediaries (or anyone acting for them) making false/misleading written or oral communication about:
- Insurance contracts, the insurance business, any insurer, or any intermediary
Specifically includes:
- Misleading info due to incompleteness
- Filing reports intending to deceive examiner
- Making false entries in records
- Failing to make proper entries to conceal information
- Using names/slogans/emblems likely to cause confusion with another intermediary
Insurer liability:
- If intermediary’s misrepresentation (cards, signs, ads, social media) references a specific insurer, violation presumed against insurer too
- Insurer and intermediary jointly responsible

Real-World Examples of Misrepresentation

False claims Medicare supplement “pays every expense” or “fills all gaps”
Unsubstantiated claims competitor insurer is “financially unsound” or agents are “crooks”
Impersonating a Social Security Administration representative to gain home access for sales purposes
Misrepresenting identity/affiliation on business cards

Misrepresentation, Rebating & Discrimination

Wisconsin groups its main marketing prohibitions under s. 628.34 and ss. Ins 6.54, 6.55. The categories are:

Misrepresentation
Unfair inducements (rebating)
Unfair discrimination
Restraint of competition
Unfair restriction of contracting parties’ choice of insurer
Extra charges
Attempt to unduly influence employers
Unfair use of official position Each one deserves its own treatment.

Misrepresentation

Information that’s misleading because of incompleteness.
Filing a report with intent to deceive the person examining it.
Making a false entry in a record.
Failing to make a proper entry in a record for the purpose of concealing information.
Using a name, slogan, emblem, or related device that will or is likely to cause an intermediary to be mistaken for another intermediary. If an intermediary distributes cards or documents, exhibits signs, or publishes advertisements (including social media posts) that include misrepresentations and reference a particular insurer the intermediary represents, the violation carries a presumption that the insurer also committed the violation. So the insurer is on the hook with the intermediary.

Real-World Examples

OCI has flagged each of the following as misrepresentation:

Telling a 77-year-old that a Medicare supplement policy “pays every expense not covered by Medicare” or “fills all the gaps.” No supplement does that.
Sending a Facebook message to a customer claiming their current health insurer is “financially unsound” and its agents are “crooks” without provable basis.
Posing as a Social Security Administration representative to gain access to a customer’s home, when the real purpose is selling insurance.
Handing out business cards identifying yourself as an agent for an ins

Wisconsin Marketing Prohibitions Overview

Governed by s. 628.34 and ss. Ins 6.54, 6.55
Eight main categories:
- Misrepresentation
- Unfair inducements (rebating)
- Unfair discrimination
- Restraint of competition
- Unfair restriction of contracting parties’ choice of insurer
- Extra charges
- Attempt to unduly influence employers
- Unfair use of official position

Misrepresentation

Violation: intermediaries (or anyone acting for them) making false/misleading written or oral communication about:
- Insurance contracts, the insurance business, any insurer, or any intermediary
Specifically includes:
- Misleading info due to incompleteness
- Filing reports intending to deceive examiner
- Making false entries in records
- Failing to make proper entries to conceal information
- Using names/slogans/emblems likely to cause confusion with another intermediary
Insurer liability:
- If intermediary’s misrepresentation (cards, signs, ads, social media) references a specific insurer, violation presumed against insurer too
- Insurer and intermediary jointly responsible

Real-World Examples of Misrepresentation

False claims Medicare supplement “pays every expense” or “fills all gaps”
Unsubstantiated claims competitor insurer is “financially unsound” or agents are “crooks”
Impersonating a Social Security Administration representative to gain home access for sales purposes
Misrepresenting identity/affiliation on business cards

Misrepresentation, Rebating & Discrimination

Wisconsin groups its main marketing prohibitions under s. 628.34 and ss. Ins 6.54, 6.55. The categories are:

Misrepresentation
Unfair inducements (rebating)
Unfair discrimination
Restraint of competition
Unfair restriction of contracting parties’ choice of insurer
Extra charges
Attempt to unduly influence employers
Unfair use of official position Each one deserves its own treatment.

Misrepresentation

Information that’s misleading because of incompleteness.
Filing a report with intent to deceive the person examining it.
Making a false entry in a record.
Failing to make a proper entry in a record for the purpose of concealing information.
Using a name, slogan, emblem, or related device that will or is likely to cause an intermediary to be mistaken for another intermediary. If an intermediary distributes cards or documents, exhibits signs, or publishes advertisements (including social media posts) that include misrepresentations and reference a particular insurer the intermediary represents, the violation carries a presumption that the insurer also committed the violation. So the insurer is on the hook with the intermediary.

Real-World Examples

OCI has flagged each of the following as misrepresentation:

Telling a 77-year-old that a Medicare supplement policy “pays every expense not covered by Medicare” or “fills all the gaps.” No supplement does that.
Sending a Facebook message to a customer claiming their current health insurer is “financially unsound” and its agents are “crooks” without provable basis.
Posing as a Social Security Administration representative to gain access to a customer’s home, when the real purpose is selling insurance.
Handing out business cards identifying yourself as an agent for an ins

Key points

Wisconsin Marketing Prohibitions Overview

Governed by s. 628.34 and ss. Ins 6.54, 6.55
Eight main categories:
- Misrepresentation
- Unfair inducements (rebating)
- Unfair discrimination
- Restraint of competition
- Unfair restriction of contracting parties’ choice of insurer
- Extra charges
- Attempt to unduly influence employers
- Unfair use of official position

Misrepresentation

Violation: intermediaries (or anyone acting for them) making false/misleading written or oral communication about:
- Insurance contracts, the insurance business, any insurer, or any intermediary
Specifically includes:
- Misleading info due to incompleteness
- Filing reports intending to deceive examiner
- Making false entries in records
- Failing to make proper entries to conceal information
- Using names/slogans/emblems likely to cause confusion with another intermediary
Insurer liability:
- If intermediary’s misrepresentation (cards, signs, ads, social media) references a specific insurer, violation presumed against insurer too
- Insurer and intermediary jointly responsible

Real-World Examples of Misrepresentation

False claims Medicare supplement “pays every expense” or “fills all gaps”
Unsubstantiated claims competitor insurer is “financially unsound” or agents are “crooks”
Impersonating a Social Security Administration representative to gain home access for sales purposes
Misrepresenting identity/affiliation on business cards