Vol. 26 Iss. 5 - November 09, 2009

Chapter 90
Proposed Regulation

Title of Regulation: 14VAC5-90. Rules Governing Advertisement of Accident and Sickness Insurance (amending 14VAC5-90-170).

Statutory Authority: §§ 12.1-13 and 38.2-223 of the Code of Virginia.

Public Hearing Information: A public hearing will be held upon request.

Public Comment Deadline: November 16, 2009.

Agency Contact: Jacqueline Cunningham, Deputy Commissioner, Bureau of Insurance, State Corporation Commission, 1300 East Main Street, P.O. Box 1157, Richmond, VA 23218, telephone (804) 371-9074, FAX (804) 371-9944, or email


The proposed amendment eliminates the requirement for insurers to file a Certificate of Advertising Compliance with its Annual Statement filing. Subsection B of 14VAC5-90-170 is being deleted, as well as accompanying Form R04.



At the relation of the


CASE NO. INS-2009-00221

Ex Parte: In the matter of Adopting
Amendments to the Rules Governing
Advertisement of Accident and
Sickness Insurance


Section 12.1-13 of the Code of Virginia provides that the State Corporation Commission ("Commission") shall have the power to promulgate rules and regulations in the enforcement and administration of all laws within its jurisdiction. Section 38.2-223 of the Code of Virginia provides that the Commission may issue any rules and regulations necessary or appropriate for the administration and enforcement of Title 38.2 of the Code of Virginia. The regulations issued by the Commission pursuant to § 38.2-223 are set forth in Title 14 of the Virginia Administrative Code.

The Bureau of Insurance ("Bureau") has submitted to the Commission a request to amend the regulations set forth in Chapter 90 of Title 14 of the Virginia Administrative Code, entitled "Rules Governing Advertisement of Accident and Sickness Insurance." The proposed amendment of 14 VAC 5-90-170 is necessary because the certification statement contained in subsection B has not improved the quality of advertisement by insurers. Advertisement quality is better served through the standards set forth in the regulations. Therefore, the Bureau has recommended that subsection B be deleted, as well as the associated Form R04.

The Commission is of the opinion that the proposed amendment submitted by the Bureau should be considered for adoption with an effective date of January 1, 2010.

Accordingly, IT IS ORDERED THAT:

(1) The proposed regulation entitled "Rules Governing Advertisement of Accident and Sickness Insurance," which amends 14 VAC 5-90-170, be attached hereto and made a part hereof.

(2) All interested persons who desire to comment or request a hearing on the proposed regulation shall file such comments or hearing request on or before November 16, 2009, in writing with Joel H. Peck, Clerk, State Corporation Commission, c/o Document Control Center, 1300 East Main Street, 1st Floor, Richmond, Virginia 23219 and shall refer to Case No. INS-2009-00221. Requests for a hearing shall state why a hearing is necessary and why the issues cannot be adequately addressed in written comments. Interested persons desiring to submit comments electronically may do so by following the instructions available at the Commission's website:

(3) If no written request for a hearing on the proposed regulation is filed on or before November 16, 2009, the Commission, upon consideration of any comments submitted in support of or in opposition to the proposed regulation, may adopt the proposed regulation as submitted by the Bureau.

(4) The Commission's Division of Information Resources shall cause a copy of this Order, together with the proposed regulation, to be forwarded to the Virginia Registrar of Regulations for appropriate publication in the Virginia Register of Regulations and shall make this Order and the attached proposed regulation available on the Commission's website,

(5) AN ATTESTED COPY hereof, together with a copy of the proposed regulation, shall be sent by the Clerk of the Commission to the Bureau in care of Deputy Commissioner Jacqueline K. Cunningham, who shall mail a copy of this Order, together with the proposed regulation, to all insurance companies licensed by the Commission to write accident and sickness insurance in the Commonwealth of Virginia, and certain other interested parties designated by the Bureau.

(6) The Bureau shall file with the Clerk of the Commission an affidavit of compliance with the notice requirements of paragraph (5) above.

14VAC5-90-170. Enforcement procedures; advertising file; certificate of compliance; corrective advertising.

A. Each insurer shall maintain at its home or principal office a complete file containing every printed, published or prepared advertisement of its individual policies and typical printed, published or prepared advertisements of its blanket, franchise and group policies hereafter disseminated in this or any other state, whether or not licensed in another state, with a notation attached to each advertisement that indicates the manner and extent of distribution and the form number of any policy advertised. The file shall be subject to regular and periodical inspection by the commission. All the advertisements shall be maintained in a file for the longer of four years or until the filing of the next regular report on examination of the insurer.

B. Each insurer required to file an Annual Statement with the commission shall file with its Annual Statement, a Certificate of Advertising Compliance executed by an authorized officer of the insurer stating that, to the best of the officer's knowledge, information, and belief, the advertisements that were disseminated by the insurer during the preceding statement year complied or were made to comply in all respects with the provisions of this chapter and Title 38.2 of the Code of Virginia as implemented and interpreted by this chapter.

C. B. If the commission finds, after notice and opportunity to be heard, as provided in § 38.2-219 of the Code of Virginia, that any advertisement is in violation of the provisions of this chapter and that the violation was to substantially deceive or to mislead the public, the commission may, in addition to any other remedy or monetary penalty it may otherwise impose, order the insurer responsible for the dissemination of such advertisement to publish at the insurer's expense, a corrective advertisement in a form to be approved by the commission. If an insurer fails to publish a corrective advertisement as required by the commission, the commission may cause a corrective advertisement to be published, and the insurer shall, in addition to any other penalty that may have been imposed, reimburse the commission for the expenses incurred in connection with the publication of the advertisement.

FORMS (14VAC5-90) (Repealed.)

Certificate of Advertising Compliance, Form R04 (eff. 11/03).

VA.R. Doc. No. R10-2173; Filed October 9, 2009, 2:45 p.m.