New York State Seal
STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

The Office of General Counsel issued the following opinion on April 26, 2001 representing the position of the New York State Insurance Department.

Re: Rebating: Life, Accident & Health Insurance

Question Presented:

May a life insurer conduct free informational seminars regarding insurance that are open to the general public and to special groups and provide refreshments and small promotional items at the seminar?

Conclusion:

Yes, provided that the seminars are open without regard to insured status, and no obligation is imposed upon attendees to apply for or purchase insurance through the insurer.

Facts:

A life insurer wishes to conduct free informational seminars that are open to the general public and to special groups (i.e. employer/employee relations and members of trade associations). Generally, the seminar topics involve long-term care insurance and the use of life insurance in estate planning. The insurer also wishes to provide free refreshments and small promotional items at the seminars.

Analysis:

N.Y. Ins. Law § 4224 (c) (McKinney 2000), applies to life, accident and health insurance and provides in pertinent part as follows:

(c) No such life insurance company and no such savings and insurance bank and no officer, agent, solicitor or representative thereof and no such insurer doing business in this state the business of accident and health insurance and no officer, agent, solicitor or representative thereof, and no licensed insurance broker and no employee or other representative of any such insurer, agent or broker, shall pay, allow or give, directly or indirectly, as an inducement to any person to insure, or shall give, sell or purchase, or offer to give, sell or purchase, as such inducement, or interdependent with any policy of life insurance or annuity contract or policy of accident and health insurance, any stocks, bonds, or other securities, or any dividends or profits accruing or to accrue thereon, or any valuable consideration or inducement whatever not specified in such policy or contract . . . (emphasis added).

N.Y. Ins. Law § 2602 (a) (McKinney 2000) provides as follows:

(a) No person shall knowingly receive any rebate or allowance or deduction from any premium, or any valuable thing, special favor or advantage whatever not specified in the policy, as an inducement to take any policy of life insurance.

In the present case, the seminars, including providing refreshments and small promotional items, would not violate the Insurance Law provided that they are open without regard to insured status and no obligation is imposed upon attendees to apply for or purchase insurance through your insurance company.

For further information, you may contact Attorney Pascale Joasil at the New York City office.