The Office of the Insurance Commissioner adopted rules relating to promotional games of chance that were effective in January 2016. The following is a brief summary of the amendments and rule changes along with some suggested best-practices guidelines and examples to assist in promoting compliance and minimizing confusion.
An insurance producer may conduct a promotional game of chance such as a raffle or a drawing under certain conditions.
- The promotional game must be for the sole purpose of advertising and promoting the insurance producer,
- No person who enters the game is required to apply for insurance, purchase insurance, refer another person to the producer, or pay any other consideration to the producer,
- The promotional game of chance is open to the public,
- The value of the promotional prize is limited to $100,
- No person may receive prizes during any consecutive 12-month period that, in the aggregate, exceed $100 in value, and
- The promotional game of chance must comply with chapter 9.46 RCW and any and all other applicable Washington state statutes and rules.
1. An insurance producer conducts an annual drawing for all of the individuals that made referrals that year and gives away an all-expense paid trip for two to British Columbia as the prize.
This is not permitted as it requires the persons being entered into the drawing to make a referral to the producer. Additionally, the value of the prize exceeds $100.
2. An insurance producer holds an annual drawing for the benefit of those who have referred prospects to him. Each referring person receives one entry in the drawing for each referred person. JoAnn Smith referred 20 prospects during that time so she has 20 entries in the drawing. The prizes are a $100 gas card, four $50 restaurant gift certificates, and 25 $25 supermarket gift cards. JoAnn wins the gas card and one of the restaurant gift certificates.
This is not permitted as it requires the persons being entered into the drawing to make a referral to the producer. If the drawing were open to the general public, not contingent upon a referral being made, JoAnn Smith would be eligible to receive more than one prize as long as the value of the prizes she receives does not exceed $100 in value in the aggregate for any consecutive 12-month period. If her name was drawn twice, Joann could be awarded the $100 gas card or the $50 restaurant gift certificate, but not both.