N.M. Admin. Code § 13.9.6.13 - VIOLATIONS AND PENALTIES
A.
Any failure to comply with this rule shall be considered a violation of Section
59A-16-6 NMSA 1978. Examples of
violations include:
(1) any deceptive or
misleading information set forth in sales material;
(2) failing to ask the applicant in
completing the application the pertinent questions regarding the possibility of
financing or replacement;
(3) the
intentional incorrect recording of an answer;
(4) advising an applicant to respond
negatively to any question regarding replacement in order to prevent notice to
the existing insurer; or
(5)
advising a policy or contract owner to write directly to the company in such a
way as to attempt to obscure the identity of the replacing producer or
company.
B. Policy and
contract owners have the right to replace existing life insurance policies or
annuity contracts after indicating in or as a part of applications for new
coverage that replacement is not their intention; however, patterns of such
action by policy or contract owners of the same producer shall be deemed prima
facie evidence of the producer's knowledge that replacement was intended in
connection with the identified transactions, and these patterns of action shall
be deemed prima facie evidence of the producer's intent to
violate this rule.
C. Where it is
determined that the requirements of this rule have not been met the replacing
insurer shall provide to the policy owner an in force illustration if available
or policy summary for the replacement policy or available disclosure document
for the replacement contract and the appropriate notice regarding replacements
in 13.9.6.14 or
13.9.6.16 NMAC.
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