§ 51.42. Exceptions, reductions and limitations.
(a) When an advertisement refers to either a dollar amount, or a period of time for which a benefit is payable or the cost of the contract, or specific contract benefit, or the loss for which the benefit is payable, it shall also disclose those exceptions, reductions and limitations affecting the basic provisions of the contract without which the advertisement would have the capacity or tendency to mislead or deceive.
(b) An advertisement may not represent or imply broad insurance coverage when under the terms of the contract, the coverage is subject to an exception, reduction or limitation without disclosing the applicable exception, reduction or limitation. Words, terms or phrases implying the broad coverage include, but are not limited to, ‘‘all,’’ ‘‘full,’’ ‘‘complete,’’ ‘‘comprehensive,’’ ‘‘unlimited,’’ ‘‘this policy will pay your hospital bill,’’ and ‘‘this policy will replace your income,’’ ‘‘this policy will help fill some of the gaps that Medicare and your present insurance leave out.’’
(c) If a policy contains a waiting, elimination, probationary or similar time period between the effective date of the policy and the effective date of coverage under the policy or a time period between the date a loss occurs and the date benefits begin to accrue for the loss, the advertisement shall disclose the existence of such periods.
(d) An advertisement may not use the words ‘‘only,’’ ‘‘just,’’ ‘‘merely,’’ ‘‘minimum’’ or similar words or phrases to describe the applicability of exceptions and reductions, such as ‘‘This policy is subject to the following minimum exceptions and reductions.’’
(e) An advertisement may not contain descriptions of a contract limitation, exception or reduction, worded in a positive manner to imply that it is a benefit such as, describing a waiting period as a ‘‘benefit builder,’’ or stating ‘‘even pre-existing conditions are covered after 2 years.’’ Words and phrases used in an advertisement to describe the policy limitations, exceptions and reductions shall fairly and accurately describe the negative features of the limitations, exceptions and reductions of the policy offered.
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