Title: To all Insurers
Reference No.: IRDAI/LIFE/CIR/MISC/147/08/2015
MASTER CIRCULAR ON INSURANCE ADVERTISEMENTS
INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA
13th August, 2015
1.1 The success of sales communication depends on public confidence and the faith they repose in the insurers, when they receive a communication from them promoting their products. As such the insurers are expected to adopt honest and fair practices in the market-place and avoid practices that tend to impair the confidence of the public. As it is very difficult for the public to understand and evaluate the latent intricacies involved in the various insurance products, it is of paramount importance that the publicity material is relevant, fair and transparent enabling informed decision making about whether or not to buy a specific insurance product. The verbal communication that the prospects receive from their advisors can be supplemented by the written material that is made available to them.
1.2 These guidelines issued with the above background are intended to protect the interests of the insuring public, enhance their level of confidence on the nature of sales material used and ultimately encourage fair business practices. They are to be considered as the minimum standards to be adhered to, in addition to compliance with the IRDA (Insurance Advertisements and Disclosure) Regulations, 2000 (hereinafter referred to as ‘Advertisement Regulations’) and the code of conduct prescribed by the Advertisement Standards Council of India (ASCI) and any other regulations as applicable. These provisions reinforce the extant regulations on all promotional communications with policyholders/prospective policyholders or targeted market segment with the objective of soliciting insurance business or otherwise.
2. Categories of Advertisements:
For the purpose of these provisions an advertisement may be classified into two types:
2.1 Institutional Advertisements
2.2 Insurance Advertisements
2.1. Institutional Advertisement: This is the advertisement of any nature which is not, either directly or indirectly, intended to solicit the insurance business, but only promotes the brand image of the insurers and/or its intermediaries and may contain the registered name, address, toll-free number, logo or trademark thereof. Advertisements issued in any mode including those that highlight sponsorships fall under this category.
Any inclusion of product names or information about the products, performance of the companies or their funds, or the information about the product launches constitute insurance advertisements as defined in para 2.2 below.
2.2. Insurance Advertisement: Any advertisement issued with the specific purpose of soliciting insurance business, and / or to influence the choice, opinion or behavior of the prospective policyholders will fall under this category. Advertisement, for this purpose, means Insurance Advertisement as defined in ‘advertisement regulations’ and is classified as under:
2.2.1 “Invitation to Inquire”: This is an advertisement which highlights the basic features of insurance/insurance products issued through recognised marketing media in any mode to create a desire to inquire further about them.
2.2.2 “Invitation to Contract”: This is an advertisement containing the detailed information regarding the insurance/insurance products mainly to induce the public to purchase, increase, modify, reinstate or retain a policy.
3. Guidelines on Advertisements:
3.1. These provisions are to be complied with by:
· All the Insurers (Life Insurers, Non-Life Insurers and Health Insurers) and
· The Insurance Intermediaries
3.2. Coverage: These provisions apply to advertisements, issued through all recognised marketing media, in any mode including printed material, radio, television, e-mails, hosting on the Internet and any other audio/visual electronic media.
3.3. General Requirements:
3.3.1 Dos’: All insurance advertisements (as indicated in para 2.2 above) should ensure that:
18.104.22.168 Communications are clear, fair and not misleading whatever be the mode of communication. They should use material and design (including paper size, colour, font type and font size, tone and volume) to present the information legibly and in an accessible manner.
22.214.171.124 Sales material and advertisements are comprehensible in the light of the complexity of the product being sold.
126.96.36.199. Brand names of the product as proposed in the File and Use application are adhered to.
188.8.131.52. When issued in vernacular languages, the mandatory disclosures are also in the same vernacular language.
184.108.40.206. All Insurance Advertisements must prominently state the availability of underlying element of ‘Life Insurance Coverage’ to clearly identify the product as an Insurance product.
220.127.116.11. Where any insurance advertisement highlights the benefit of Guarantees, a clear disclosure of the underlying conditions under which the guarantee operates must be made, wherever applicable. In all such cases, all the conditions (including cost of guarantee, charges) under which the guarantee operates need a prominent mention. If the underlying conditions are very elaborate, the text/wording on Guarantee must be accompanied by the phrase “Conditions Apply” in a font that is at least 50% of the font used to highlight the guarantee. These conditions must be distinctly mentioned in a legible font beneath, not making it part of other applicable disclosures.
18.104.22.168 In respect of Unit Linked Life Insurance Products the actual asset mix of various underlying funds vis-à-vis the asset composition of approved asset pattern shall be placed on the web portal of respective life insurance companies at least on a half yearly basis. This information on investment updates is to ensure that clear, actual and timely information is made available to prospects to make an informed financial decision.
22.214.171.124. The design, content or format shall not disguise, obscure or diminish the significance of any statement, warning or other matter which an advertisement should contain as required by these provisions.
126.96.36.199. Use or denigrate names, logos, brand names, distinguishing marks, symbols etc., which may be similar to those already used by others in the market that may lead to confusion in the market place.
188.8.131.52. The Brand Names of insurance products must not use terms or phrases that convey a fabricated sense of security.
184.108.40.206 The features / benefits prominently displayed in the Insurance Advertisements shall not be the features / benefits that are applicable under extreme / exceptional scenarios.
3.4. Specific Requirements for an “Invitation to Contract” (Refer para 2.2.2):
3.4.1. Dos’: Advertisements should ensure that:
220.127.116.11. Any expression of opinion of the insurer is a fair and honest representation.
18.104.22.168. Any statement of fact, promise or projection discloses all the relevant assumptions; and indicates in a clear and prominent way significant limitations / criteria on which any special offers are available.
22.214.171.124. Where attention is drawn to insurer’s past financial performance it should indicate that the past performance is not an indication of future performance.
126.96.36.199. The contents should necessarily include:
a. The nature of the insurance contract (i.e., whether traditional/unit linked) and the type of the product (i.e., its uniqueness or otherwise, whether annuity, pension, health or whole life, home owners’, shop keepers policies and any combination thereof, etc.,).
b. The risks involved; the limitations and exclusions of the contract;
c. Illustrations which indicate the exact costs and charges; reasonable projections of benefits; and full disclosures of the basis and sources of information (e.g., disclose date of NAV);
d. The commitment of the insurer and the policy holder under the contract (e.g. the minimum amount to be invested; minimum and/or maximum sum assured; lock-in period; the reasonable safety norms to be adopted in case of non-life insurance products etc.,)
188.8.131.52. Where illustrations are provided, they should adhere to the guidelines/circulars issued, if any, by the Authority or the Council.
3.4.2. Don’ts: The advertisements should not:
184.108.40.206 Highlight the potential benefits of an insurance contract without giving a fair indication of the risks.
220.127.116.11 Draw attention to favorable tax treatment without stating that they are subject to changes in the tax laws.
18.104.22.168 Highlight the positive financial condition of the parent (or promoting partner) company without mentioning the financial condition of the insurer and/or indicate that the assets of parent company can be banked upon when desired.
22.214.171.124 Disclose benefits partially without disclosing the corresponding limitations/ conditions/ implications.
126.96.36.199 Indicate that acceptance of risk and/or settlement of claims are liberal and generous without an intent to do so.
188.8.131.52 Use ambiguous words or phrases which are likely to exaggerate the underlying benefits of the policies or plans and/or capable of limiting the actual exclusions or the limitations of the underlying benefits of the plan.
184.108.40.206 Denigrate or Damage the reputation of the competitor or the industry.
3.5. Mandatory disclosure in ‘Invitation to Inquire’: Every advertisement in the nature of ‘invitation to inquire’ should disclose the following statement “For more details on risk factors, terms and conditions please read sales brochure carefully before concluding a sale”.
3.6. Advertising through the Internet and other Electronic Media: Provisions applicable to published advertisements apply equally to advertising through electronic media i.e., advertisements through a telephonic interactive mode or on the internet.
220.127.116.11. In case of communications on/through internet an insurer should ensure that the recipients/viewers have the opportunity to view the full text of the relevant key features; terms and conditions; any other applicable risk information required by these guidelines and they shall not be hidden away in the body of the text. It shall be easily obtained, before any application form is offered. In case of e-mail communications there should be a provision to unsubscribe from the mailing list.
18.104.22.168. Text, graphics, hyperlinks and sound should be entirely consistent with all the requirements specified herein.
22.214.171.124. Insurers should take an undertaking from the prospective policyholders that they have read the entire text, features, disclosures, terms and conditions, etc., while applying for insurance on-line.
126.96.36.199. Mandatory provision of a helpline or help number to further provide all information that a policyholder would reasonably expect.
188.8.131.52. Insurers should provide hard copy of the necessary information on request.
3.6.2. Telephonic Interactive Mode:
184.108.40.206. Promotional activities through Cold-calls shall be preferably by a licensed intermediary. In case it is done by other than licensed intermediary, responsibility of compliance with advertisement regulations and the related circulars/guidelines vests with the insurer/intermediary that has outsourced this activity.
220.127.116.11. The telephone caller shall take necessary steps to ensure that they do not intrude into the privacy of the receiver. They should disclose their identity and proceed to converse only after permission.
18.104.22.168. A reference on the access to full information about the available products and the importance of financial need analysis along with the contact phone numbers which can provide such information shall be placed before closing the call.
22.214.171.124. Every insurer shall facilitate an access to ‘do not call registry’ with the contact numbers of the persons who wish not to be contacted, which should be referred to, before every call.
3.7. Joint Sale Advertisements (JS): Any insurance advertisement brought out jointly by an insurer either with its corporate agent or with a micro-insurance agent would fall under this category. These could relate to promotional activities where the logo/trademark/trade names of the participating parties are displayed jointly.
3.7.1. Joint sale advertisements in the nature of insurance advertisements (as defined in para 2.2 above) can be released without prior approval of the Authority in accordance to the applicable regulations / circular provisions in vogue and file the same.
3.7.2 All the joint Sale Advertisements released shall be filed separately specifically mentioning therein that the Advertisements filed are ‘Joint Sale Advertisements’ along with a certificate from the Appointed Actuary that it presents the same features of the product as cleared under File and Use.
3.7.3. The contents of these provisions will apply in mutatis mutandis to all the JS advertisements, as applicable.
4. Branding with Third parties: (Third parties for this purpose shall mean any individual/association/entity other than insurance intermediary)
4.1 Can be used on any advertisement of insurer/ intermediary only when it does not urge the prospect or a policyholder to purchase, renew, increase, retain or modify a policy of insurance.
4.2 An exemption is however, given to insurance schemes sponsored/subsidized by Central/State government (s) in which case branding is permissible in any category of advertisements.
4.3 The onus vests with the insurer as to the compliance requirements of ‘advertisement regulations’ and the related circulars/provisions issued from time to time, in such cases.
5.1. Any claim of rating/award should be based only on those declared by entities which are independent of the insurers and its affiliates. Insurers and its affiliates should not however, procure services from such independent entities so as to get a rating/award.
5.2. Source of such rating/award is to be disclosed conspicuously and legibly in such advertisements.
5.3. No claim of ranking by Insurer, as regards its position in the insurance market, based on any criteria (like premium income or number of policies or branches or claims settlements etc.,) is permissible in any of the advertisements.
6. Mandatory disclosure as specified by ‘advertisement regulations’ and applicable guidelines/Circulars as may be specified from time to time should be clear, conspicuous and legible and should find at least 10% of the total space utilized for the advertisement in print/visual mode with a minimum print equivalent to font ‘Times New Roman’ No. 7. In case of audio mode, these disclosures should be spelt for at least 10% of the total time slot of the advertisement.
7. All the advertisements should carry a unique identifiable reference number as maintained in the advertising register in accordance with regulation 3 (v) (a) of the regulations.
8. Use of taglines by registered insurers/licensed entities:
8.1 All licensed entities soliciting insurance business should mention their identity and contact details. Any person who is found to be guilty of misleading the prospect on any insurance product will be viewed seriously.
8.2 All the registered insurers and licensed intermediaries shall print the following text (font size should not be less than 9) at the bottom of all their advertisements (both institutional and insurance advertisements) and other publicity material including policy documents, premium receipts, renewal notice, bill boards/display boards and logos released through print or electronic media:
For Insurers .... IRDA Regn. No. __________
For Intermediaries ... IRDA License No. _________
9. Where material is filed with the Authority in accordance with the ‘advertisement regulations’, in other than English/Hindi language, true translation of the same in English/Hindi duly certified by an Authorised officer of the insurer, is to be enclosed.
10. Advertisements filed in accordance with Regulation 3(v) of the ‘Advertisement Regulations’ including Joint Sale Advertisements should be filed within 7 days of their release.
11 All Insurance Advertisements approved by Insures for their Insurance Agents (Individual Agents and Corporate Agents) in accordance with the provisions of Regulation (6) IRDA (Insurance Advertisements) Regulations, 2000 and Clause 12 of Guidelines on Licensing of Corporate Agents No. 017I/IRDA/Circular/CA Guidelines/2005 dated 14th July, 2005 shall also comply with all provisions of Advertisement Regulations and the provisions of this Master Circular and shall form part of Advertisement register referred at Regulation 3 (iii) of Insurance Advertisement Regulations. These Advertisements shall also be filed within 7 days as referred at clause 10 above.
12. In Unit linked business, advertisements issued by Life Insurers should also adhere to the advertisement norms prescribed in IRDA (Linked Insurance Products) Regulations, 2013
13. 0% and 100% allocation charges under ULIP Products
13.1 Some companies have products with 0% or 100% (or more) allocation charges under ULIP products. These two situations are special in nature and hence in either case additional information is required in the undertaking to be given by the policyholder to avoid any confusion. It has been decided that the Insurer should
13.1.1 In the case of products having 0% allocation, the benefit illustration should carry a declaration in capital and bold letters. “I ALSO UNDERSTAND THAT NO PART OF MY FIRST YEAR PREMIUM WILL BE INVESTED IN UNIT LINKED INVESTMENT FUNDS”.
13.1.2 In the case of 100% allocation product
a. The Company must not issue specific advertisements or sales literature or any other marketing material (print or electronic or any other form) positioning the product as offering 100% (or more) allocation of premium in first policy year.
b. The benefit illustration should carry a declaration in capital and bold letters. This declaration is “I ALSO UNDERSTAND THAT WHILST ___% OF MY FIRST YEAR PREMIUM WILL BE INVESTED IN UNIT LINKED INVESTMENT FUNDS THERE ARE CHARGES DURING THE FIRST POLICY YEAR AS GIVEN IN THE BENEFIT ILLUSTRATION”.
14. Norms while promoting the Product Combinations
14.1 Life Insurance Advertisements should not offer, as inducement, any award / reward points, discounts and rebates, except those approved by the Authority as part of product features, either from Insurer directly or through arrangement with any third party involving any expenses / costs / outgo to the Insurer.
14.2 Where more than one product and combination of their benefits are promoted in a single advertisement, there shall be a complete disclosure of all the related particulars of Individual Products, inter alia, a reference to the respective product names and UIN, a caveat advising the prospect to refer the detailed sales literature of the respective individual products, segregated premium particulars of each product.
14.3 Such advertisements as described in (14.2) above should contain a specific declaration as “Advertisement Disclaimer” on Top in BOLD not less than Font size 7.
“This advertisement is designed for combination of Benefits of two or more individual and separate products named (1) ____ (2) ____ (3) ____ (as applicable) etc. The Customer has the choice of purchasing any one or more products as per his/her need and choice and there is no compulsion whatsoever that these products are to be taken together as suggested by the Insurer and presented in this advertisement. The customer is expected to ask questions, understand and satisfy himself that the combination meets his/her specific needs better before deciding to purchase the suggested combination. This Benefit Illustration is the arithmetic combination and chronological listing of combined benefits of individual products. The customer is advised to refer the detailed sales brochure of respective individual products mentioned herein.”
14.4 A certificate by the Appointed Actuary must be enclosed at the time of filing of advertisements as described in (14.2) with the Authority which will state –
i) The benefit illustration shown by combining the benefits of more than one products is nothing but the arithmetical Combination of all the individual product benefit illustrations (state product names and UIN) as approved by the Authority and is a proper chronological and combined listing of the benefits of two or more individual products.
ii) The benefit illustration shown in the advertisements truly and fairly represents the combined benefits of individual products and does not in any way exaggerate the same.
14.5 All Life Insurers shall ensure that any insurance advertisements used by insurance agents/intermediaries are duly approved as per the provisions of Regulation 6 of IRDA (Insurance Advertisements) Regulations, 2000 and filed within 7 days from the date of the release.
14.6 IRDA (Linked Insurance Products) Regulations, 2013 & IRDA (Non-Linked Insurance Products) Regulations 2013, as applicable to Linked/Non-Linked Products being part of the Combination, need to be complied with.
15. Spurious Phone Calls and Fictitious/Fraudulent Offers
15.1 All Life Insurers shall flash on their Home Page of their websites, the following Public Notice issued by IRDAI cautioning general public about spurious calls and fictitious offers. This may also be inserted in a box item prominently at the end of all their product advertisements in print media including pamphlets, publicity material, etc. with a view to educate the customers on the role of Regulator and also caution the public on spurious calls.
BEWARE OF SPURIOUS PHONE CALLS AND FICTIOUS/FRADULENT OFFERS
IRDAI clarifies to public that
· IRDAI or its officials do not involve in activities like sale of any kind of insurance or financial products nor invest premiums.
· IRDAI does not announce any bonus.
· Public receiving such phone calls are requested to lodge a police complaint along with details of phone call, number.
15.2 At the end of TV Advertisements/Cinema Hall Advertisements of Life Insurance, the slide placed at Annexure –I may be displayed continuously for a minimum period of 5 (five) seconds. (Hindi version in Annexure-II is also enclosed) (Please download the .zip file for Annexures I & II). True translation in other Indian Languages may also be used as per need with due certification.
16. This Master Circular supersedes all the circulars listed in the Annexure-A.
Annexure – A
List of Circulars
Subject of the Circular/Advisory
Related Clauses in the Master Circular
14th May, 2007
Guidelines on Advertisement, Promotion and Publicity of Insurance Companies and Insurance Intermediaries
16th October, 2008
0% and 100% Allocation Charges under ULIP Products
16th August, 2010
Advertisements – Life Insurance Products
Clauses 126.96.36.199; 188.8.131.52; 184.108.40.206 and 220.127.116.11
17th July, 2012
Modified Guidelines on Advertisements
Clauses 3.7.1 and 3.72; Clause 10 and Clause 11
10th Sept, 2013
Advertisements – Life Insurance Products (Combination of plans)
17th Jan, 2014
Use of taglines by registered insurers/licensed entities
27th Jan, 2014
Spurious Phone Calls and Fictitious / Fraudulent Offers
Clause 15 (Gist of the Circular Included)
13th Feb, 2014
Spurious Phone Calls and Fictitious / Fraudulent Offers
Clause 15 (Gist of the Circular Included)
24th June, 2014
IRDAI Notice on Spurious Phone Calls to be included in all Insurance Advertisements
Clause 15 (Gist of the Circular Included)