FTC Issues Opinion on Insurance Telemarketing

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The Federal Trade Commission issued an opinion yesterday stating that its authority to regulate telemarketing calls extends to calls made by or on behalf of insurance companies, with some exceptions.

Some in the insurance industry have challenged the FTC's right to regulate their telemarketing activities, claiming that under the McCarran-Ferguson Act the regulation of the "business of insurance" is left to the states.

In its opinion, the FTC stated that in some cases that might be true, but only if the activity fits the definition of the "business of insurance" under the act, and if the activity also is already controlled by state laws made specifically for the purpose of regulating insurance activity.

The agency would judge each case on the nature of the insurance product sold, the state in which it was sold and the laws in that state, the FTC said. Whether insurance marketers conducted calls in-house or contracted them to a third party is irrelevant, the FTC said.

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