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  • FAN-0114AO.12 (02/18) 1

    Nationwide Life Insurance Company Nationwide Life and Annuity Insurance Company

    Updated February 2018

    For Insurance Professional Use Only

    The rules, policies and procedures of this Guide apply only to the sale, solicitation and negotiation of Nationwides life insurance and annuity products.

    This Guide is not a contract and is not intended to create any contractual rights in favor of the Agent or Nationwide. The Guide does not alter the current relationships between the Agent and Nationwide. Furthermore, Nationwide Life Companies reserve the right to change, alter or amend any portion of this Guide at its discretion at any time.

    Business Practices and Compliance Guide

  • FAN-0114AO.12 (02/18) 2

    The following content has been updated in this version of the guide: Section 6.1 Prohibited Forms of Payment Section 7.7 Unique State Requirements Section 10(h) Prohibited Activities (Ethical Conduct) Section 13 DOL Conflict of Interest Rules

  • FAN-0114AO.12 (02/18) 3

    SECTION 1 DEFINITIONS.. PAGE 6

    SECTION 2 OVERVIEW AND PURPOSE ......................................................... PAGE 7

    SECTION 3 LICENSING AND APPOINTMENTS .............................................. PAGE 8

    Section 3 Licensing and Appointments.. PAGE 7 (a) Licensing Requirements ..........................................................................PAGE 8 (b) Maintaining a License .............................................................................. PAGE 8 (c) Appointment and Notification Requirements ............................................ PAGE 8

    Section 3.1 Errors and Omissions Insurance ........................................................ PAGE 9

    Section 3.2 Contracting ........................................................................................... PAGE 9

    Section 3.3 RecruitingPAGE 9

    Section 3.4 Terminations..PAGE 9 (a) Termination for Cause.............................................................................. PAGE 10

    SECTION 4 PROFESSIONAL DESIGNATIONS PAGE 11

    SECTION 5 MARKETING AND SOLICITATION .. PAGE 12 (a) Marketing, Advertising and Communication........... PAGE 12 (b) Foreign Language Marketing Materials ................................................ PAGE 12

    Section 5.1 Solicitation ........................................... .................. PAGE 12 (a) Selling to Seniors PAGE 13

    Section 5.2 Record Keeping ........................................................................... . PAGE 13 (a) Record Retention .................................................................................. PAGE 14

    SECTION 6 NEW BUSINESS SUBMISSION .................................................. PAGE 15

    Section 6.1 Prohibited Forms of Payment and Transfers ................................... PAGE 16

    Section 6.2 Replacements ..................................................................................... PAGE 17

    Section 6.3 International Underwriting Guidelines .............................................. PAGE 17

    Section 6.4 Non-Resident (Cross Border) Sales .................................................. PAGE 17

    Section 6.5 Life Insurance Illustrations ................................................................ PAGE 18

    Section 6.6 Policy Amendments ........................................................................... PAGE 18

    Section 6.7 Policy Delivery .................................................................................... PAGE 19

  • FAN-0114AO.12 (02/18) 4

    SECTION 7 LONG TERM CARE ..................................................................... PAGE 20

    Section 7.1 Insurance Professional Licensing and Training............................... PAGE 20

    Section 7.2 Standards for Marketing Long-term Care ......................................... PAGE 20

    Section 7.3 Prohibited Practices ........................................................................... PAGE 18

    Section 7.4 Suitability ............................................................................................ PAGE 21

    Section 7.5 Replacement ....................................................................................... PAGE 21

    Section 7.6 HIPAA .................................................................................................. PAGE 22

    Section 7.7 Unique State Requirements ............................................................... PAGE 22

    SECTION 8 SUITABILITY ............................................................................... PAGE 24

    Section 8 Suitability ............................................................................................ PAGE 24 (a) Annuity Suitability .................................................................................. PAGE 24 (b) Fixed Life Insurance Suitability .............................................................. PAGE 25 (c) Failure to Comply with Suitability Standards .......................................... PAGE 25

    SECTION 9 CONSUMER PRIVACY AND CONFIDENTIALITY.........PAGE 26

    SECTION 10 PROHIBITED ACTIVITIES ........................................................... PAGE 27

    Section 10 Prohibited Activities ........................................................................... PAGE 27 (a) Accepting Cash ..................................................................................... PAGE 27 (b) Altered Documents ................................................................................ PAGE 27 (c) Blank Forms .......................................................................................... PAGE 27 (d) Commission Assignments ..................................................................... PAGE 27 (e) Commission Splitting ............................................................................. PAGE 27 (f) Creating Fictitious Sales ........................................................................ PAGE 27 (g) Disparaging Remarks about Competitors .............................................. PAGE 27 (h) Ethical Conduct.PAGE 27 (i) Falsifying an Application ........................................................................ PAGE 27 (j) Failure to Furnish Information ................................................................ PAGE 28 (k) Financial Arrangements with Consumers .............................................. PAGE 28 (l) Forgery .................................................................................................. PAGE 28 (m) Fraudulent Conduct ............................................................................... PAGE 28 (n) Mail ....................................................................................................... PAGE 28 (o) Offering Legal or Tax Advice ................................................................. PAGE 28 (p) Pretexting Selling .................................................................................. PAGE 29 (q) Prohibited Payments ............................................................................. PAGE 29 (r) Prohibition against Guarantees ............................................................. PAGE 29 (s) Rebating ................................................................................................ PAGE 29 (t) Scare Tactics ......................................................................................... PAGE 29 (u Selling an Indexed Product as a Security .............................................. PAGE 29 (v) Selling an Annuity Prior to Completion of Required Training .................. PAGE 29

  • FAN-0114AO.12 (02/18) 5

    (w) STOLI / STOVA / Life Viatical Settlements ............................................ PAGE 29 (x) Switching and Replacements ................................................................ PAGE 30 (y) Twisting ................................................................................................. PAGE 30 (z) Unfair Solicitation .................................................................................. PAGE 30

    SECTION 11 ANTI-MONEY LAUNDERING ...................................................... PAGE 31

    Section 11 Anti-Money Laundering...................................................................... PAGE 31 (a) Red Flags for All Business ..................................................................... PAGE 31

    SECTION 12 CUSTOMER COMPLAINTS ........................................................ PAGE 33

    SECTION 13 DOL CONFLICT OF INTEREST RULES ..................................... PAGE 34 (a) PTE 84-24 ............................................................................................. PAGE 35 (b) PTE 2016-01 (BIC Exemption) .............................................................. PAGE 35 (c) The Best Interest Standard .................................................................... PAGE 35

  • FAN-0114AO.12 (02/18) 6

    1. Definitions

    Agent of Record the Insurance Professional currently listed on the life insurance or annuity contract and/or authorized to service the contract

    Applicant an individual applying for an insurance product

    Business Associate Agreement the agreement between Nationwide Life Companies and the Insurance Professional that is required when selling a long-term care insurance contract with some of its life insurance products (e.g., CareMatters)

    Client an existing customer of an Insurance Professional

    Consumer a broad term to describe an individual that may be an insurance prospect, an applicant for an insurance product, or an existing contract owner or policy owner

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