Alabama § 27-12-10 - Financial Inducements to Purchase Insurance.

§ 27-12-10. Financial Inducements to Purchase Insurance.

(a) No person shall issue or deliver, or permit its agents, officers, or employees to issue or deliver, agency company stock or other capital stock, or benefit certificates or shares in any common-law corporation, or securities, or any special or advisory board contract or other contract of any kind promising returns and profits as an inducement to insurance. The commissioner shall refuse to issue a certificate of authority or license to any insurer or other person that is in violation of this section and shall revoke the certificate of authority or license of any such violating insurer or person if such authority or license is already outstanding.

(b) No person shall issue or deliver, or permit its agents, officers, or employees to issue or deliver, in this state, any life insurance policy or contract of annuity in which are used such words as “investment plan,” “expansion plan,” “profit-sharing,” “charter plan,” “founders’ plan,” “surplus-sharing,” or similar language in such context or under such circumstances or conditions as to have the capacity or tendency to mislead a purchaser or prospective purchaser of life insurance to believe that he will receive or that it is probable he will receive something other than an insurance policy, or contract, or some benefit not provided in the policy or contract or some benefit not available to other persons of the same class and equal expectation of life.

(c) No insurer shall issue or deliver, or permit its agents, officers, or employees to issue or deliver, in this state a policy of life insurance containing benefits in the form of “coupons” or “guaranteed annual endowment” benefits unless the premium charged for the insurance coverage and the premium charged for the “coupons” or “guaranteed annual endowment” benefits are prominently specified in the policy separately from each other in dollar amounts. This shall not apply to any policy in which the amount of any pure endowment or periodic benefit, or benefits, payable during any policy year is greater than the total annual premium for such year.